Impact of introducing one-stop employment service centres on local employment in South Korea

ABSTRACT

This paper evaluates whether the introduction of one-stop centres – providing integrated public employment and welfare services – contributes to the employability of local residents in Korea. Exploiting a quasi-experimental assignment of one-stop centres across 162 municipalities, we apply a spatial difference-in-difference model using the Regional Employment Survey 2013–2017. Our findings reveal that the introduction of the centres has a positive impact on the local employment rate of female residents but not that of their male counterparts.

KEYWORDS:

• One-stop employment service centres
• spatial difference-in-difference
• local employment rates
• South Korea

JEL CLASSIFICATION:

• J10
• J68
• C31
• C33

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

¹ The Korean government has introduced centres to the areas where they could be quickly implemented, regardless of the extent of vulnerability of the local labour market. Thus, we assume that the introduction of centres is likely to be a quasi-random assignment. To confirm the exogeneity indirectly, we conducted a placebo test by arbitrarily changing the timing of introducing EWPCs, which confirmed that the impact of the centres on the local employment rates disappeared. The complete results are available upon request.

² To make the digits of the coefficient estimates more readable, the local employment rate (dependent variable) is multiplied by 100 and expressed in percentage terms.

³ The results not considering spatially correlated treatment were generally similar to the SDID results. The results are available upon request from the authors.

Additional information

Funding

This work was supported by the Konkuk University in 2020.