This paper analyses the impact of a regional policy aimed at fostering permanent employment after the COVID-19 recession. Using administrative micro data from the Italian private sector, we estimate the impact of subsidies on permanent employment by examining variations in their implementation across regions and over time.
In the first half of 2021, compared with the average for the period 2017-20, the effect on the hiring of previously unemployed people is limited, but the impact on the conversion of fixed-term contracts to permanent ones is positive and sizeable (50 per cent). Those who benefited the most were young people and women - for whom subsidies were more generous - and workers with higher education.
