Page 43 - IDEA Study 3 2018 Low skilled

the low-skilled should therefore be accompanied by measures that would help remove these additional obstacles. For example, interventions for the long-term unemployed that focus on financial literacy and solving financial problems may be crucial to complement the activation measures. Matching the low-skilled to their jobs must also consider the constraints on the demand side. There is substantial variation in the demand for the low-skilled across regions, but the low-skilled are typically the least flexible to commute for work or to move. The recently introduced measure “Příspěvek na podporu regionální mobility” (Contribution to Support Regional Mobility) aims to increase the employability of the unemployed by enhancing their regional mobility. Job-seekers who are registered at local labor offices and who accept jobs outside of the area of their permanent residence are entitled to two types of benefits: Commuting Support, which can be used for any work-related costs incurred to a person that accepts a distant job, such as cost of transportation, fuel expenditures, accommodation or child care costs, and Reallocation Support, which helps cover the cost of moving to a new area because of a new job. While these measures could help the low- skilled considerably, they are likely to be predominantly used by higher skilled jobless individuals, who are also more likely to find both local and distant jobs. Implementation of these measures should therefore specifically focus on the low-skilled and be complemented with additional assistance in helping the low-skilled to find more distant jobs and encouraging higher mobility with the help of these subsidies. An alternative approach to assist the low-skilled in entering paid work would be via self- employment. As noted previously, the low-skilled are much less likely to be self-employed than the other skill groups. Active labor market policies that provide a subsidy to the unemployed who start their own business are rarely used by the low-skilled. This is likely driven by the lack of relevant labor-market skills as well as by the lack of know-how with respect to becoming an entrepreneur. In the case that the low-skilled possess relevant skills for the labor market, providing them with advice and specific assistance in starting their own business could be a viable strategy. The high unemployment rate among the low-skilled is driven not only by the low probability of exit from unemployment (as the unemployed cannot find jobs), but also the high probability of entry. The employed low-skilled, who often struggle to retain a stable job, face a high risk of unemployment. We have seen that the low-skilled jobs are not only typically low-paid, but are also often only temporary. One of the reasons for the high prevalence of temporary contracts among the low-skilled are the high employer 41