Evaluation of the Scholarship for the Training of Skilled Workers of the Public Employment Service

This study evaluates the Skilled Worker Scholarship (FKS) and the Nursing Scholarship (PFS) as active labour market policy instruments designed to promote longer-term vocational training in Austria. It analyses their implementation, structure and impacts, drop-out rates, and contribution to the supply of skilled workers over the period from 2013 to 2024. The microeconometric impact analysis focuses on the Skilled Worker Scholarship. It reveals pronounced short-term lock-in effects during the training phase, which are accompanied by significantly lower employment and substantial income losses in the first three years. However, these effects reverse once training is completed: participants exhibit permanently higher employment rates and achieve substantial long-term income gains. The initial income losses are more than offset over time. Both cumulative earned income and average monthly income are significantly higher in the long term than those of comparable non-participants. Furthermore, there are positive effects on occupational mobility into sectors in demand, as well as high returns on education. Additionally, the study discusses potential for optimisation, particularly with regard to the process for selecting eligible training courses.