ERIC Number: ED427185
Record Type: Non-Journal
Publication Date: 1998
Reference Count: N/A
The Bridging Allowance as an Instrument of Labour Market Policy--A Provisional Appraisal. IAB Labour Market Research Topics No. 30.
Since 1986 the Federal Employment Service in Germany has used the so-called "bridging allowance" to assist previously unemployed people in setting up their own businesses. This allowance is intended to guarantee the social security and subsistence of the person setting up the business during the start-up phase, until the young enterprise has become consolidated. Positive effects are expected for the labor market in two different respects. First, the person setting up the new business eases the strain on the unemployment insurance program with the step into self-employment. Second, if they are successful, the newly established businesses may result in further employment opportunities, thus contributing to the fight against unemployment. In the last 3 years about a quarter of a million previously unemployed people have set up their own businesses with the help of the bridging allowance. About 3 years after setting up their own business, 70 percent of those who received the bridging allowance are still self-employed. A further 5 percent still do the work for which they received the financial support, but as a secondary activity. At present, there is an average of one additional employee to each person who originally received financial support to start a business. The net effect cannot yet be determined, but looks to be positive. (Contains 51 references) (Author/KC)
Descriptors: Education Work Relationship, Entrepreneurship, Financial Support, Foreign Countries, Job Training, Program Effectiveness, Self Employment, Small Businesses
Web site: http://www.iab.de
Publication Type: Reports - Research
Education Level: N/A
Authoring Institution: Institute of Employment Research, Nurenberg (Germany).
Identifiers - Location: Germany