Fostering Soft Skills in Active Labor Market Programs: Evidence from a Large-Scale RCT

The Employment Circles program targets unemployed income-support claimants aged 20 to 50, aiming to promote their integration into the labor market and reduce the risk of long-term welfare dependency and chronic unemployment. Its main goal is to foster participants’ work-related soft skills such as motivation, self-efficacy, self-esteem, and interpersonal abilities. To achieve this, the program provides personalized treatment composed of weekly sessions with occupational trainers, therapeutic group meetings with coaches, and job search assistance workshops.

Schlosser and Shanan (2025) evaluate the effects of the program using a large-scale RCT. The data is based on administrative records that measure employment, income, and social benefits combined with a follow-up survey that measures participants’ soft skills.

The results show that twelve months after randomization, the program raised participants’ employment rates by 8 percentage points relative to the control group (a 24% increase), lessened their welfare dependency by 11 percentage points (a 26% decline), and lowered the share of treated participants reporting to the employment office by 15 percentage points (a 38% reduction). Results show also positive effects on participants’ soft skills, mainly among those with no recent employment history.