This working paper examines wage progression as one theoretical explanation for the existence of a long-term impact on employment due to the Self-Sufficiency Project (SSP). In order to qualify for the supplement, program group members had to find full-time work within one year of random assignment and, once they qualified, they received the supplement while they were working during the subsequent three years.
Because of this additional incentive to work, these “take-up” group members acquired more full-time work experience than comparable control group members. The greater full-time work experience should imply, on average, that at the end of the follow-up period the wages of take-up group members were higher than that of comparable control group members.
This is referred to as “relative wage progression.” Because of the higher wages, take-up group members should be more likely to work than comparable control group members even after the supplement period has ended. That is, relative wage progression is one avenue through which SSP might have had long-term impacts on the ability of recipients to work full time.
Published: March 2006
Policy Area: Income Security - Welfare and Employment
Population: Low-income Populations - Low-skilled Workers - Social Assistance Recipients - Women - Communities and Families - EI Recipients
Type: Working paper