Active labor market policies and low inequality go hand in hand

Policy Brief

Active labor market policies (ALMP) do not only play an important role in getting unemployed quickly back into work. High spending on active labor market policies and low inequality also go hand in hand. Unemployment creates economic inequality and this inequality would be larger if the country does not spend money on activation of unemployed in order to help them get a job. Furthermore, there is a redistributive effect because everybody contributes via taxes, but ALMP tend to benefit low-income unemployed.

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