{
  "title": "The Welfare Implications of Job Retention Schemes",
  "publication": "IMF Working Papers, January 30, 2026",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2026/01/30/the-welfare-implications-of-job-retention-schemes-573549",
  "canonical": "https://www.imf.org/en/publications/wp/issues/2026/01/30/the-welfare-implications-of-job-retention-schemes-573549",
  "overlayPath": "/en/publications/wp/issues/2026/01/30/the-welfare-implications-of-job-retention-schemes-573549/index.md",
  "summary": "This paper examines the welfare implications of job retention schemes, where governments subsidize employers to preserve jobs during downturns. Using EU microdata from 2003 to 2018, we show that such schemes are associated with lower job separation rates, especially among lower-productivity workers.",
  "sections": [
    {
      "heading": "Summary",
      "content": "- Examines welfare implications of job retention schemes in which governments subsidize employers to preserve jobs during downturns.\n- Uses EU microdata from 2003 to 2018.\n- Builds a search-and-matching model with occupational choice, calibrated to the United Kingdom during the global financial and sovereign debt crises.\n- Simulations find a retention policy scheme aimed at reducing unemployment by nearly 1 percentage point would have been both welfare-enhancing and cost-effective."
    },
    {
      "heading": "Empirical evidence (EU microdata, 2003 to 2018)",
      "content": "- Job retention schemes are associated with lower job separation rates.\n- The reduction in job separations is especially pronounced among lower-productivity workers."
    },
    {
      "heading": "Model and calibration",
      "content": "- Framework: search-and-matching model with occupational choice.\n- Calibration target: United Kingdom during the global financial and sovereign debt crises."
    },
    {
      "heading": "Simulation results and welfare effects",
      "content": "- Targeted policy: retention scheme aimed at reducing unemployment by nearly 1 percentage point.\n- Average welfare increase: 0.06 percent in consumption-equivalent terms.\n- Distributional outcome: low-income workers benefit more than twice as much as the median worker by avoiding costly job switches and unemployment spells."
    },
    {
      "heading": "Key statistics and publication identifiers",
      "content": "- Pages: 56\n- Volume: 2026\n- Issue: 015\n- Series: Working Paper No. 2026/015\n- DOI: https://doi.org/10.5089/9798229037884.001\n- ISBN: 9798229037884\n- ISSN: 1018-5941\n\nIMF Working Paper — John C Bluedorn; Dr. Jorge Mondragon; Ippei Shibata; Marina Mendes Tavares; January 30, 2026.\n\n---\n\n Content in this bundle\n\n- Working Paper\n  - Working Paper (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Working Paper (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2026/01/30/the-welfare-implications-of-job-retention-schemes-573549"
    }
  ],
  "bullets": [
    "[Markdown version](/en/publications/wp/issues/2026/01/30/the-welfare-implications-of-job-retention-schemes-573549/index.md)",
    "[Structured JSON version](/en/publications/wp/issues/2026/01/30/the-welfare-implications-of-job-retention-schemes-573549/index.json)",
    "[Bundle manifest](/en/publications/wp/issues/2026/01/30/the-welfare-implications-of-job-retention-schemes-573549/bundle-manifest.json)",
    "Authors: John C Bluedorn, Dr. Jorge Mondragon, Ippei Shibata, Marina Mendes Tavares",
    "Published: January 30, 2026",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9798229037884.001",
    "Examines welfare implications of job retention schemes in which governments subsidize employers to preserve jobs during downturns.",
    "Uses EU microdata from 2003 to 2018.",
    "Builds a search-and-matching model with occupational choice, calibrated to the United Kingdom during the global financial and sovereign debt crises.",
    "Simulations find a retention policy scheme aimed at reducing unemployment by nearly 1 percentage point would have been both welfare-enhancing and cost-effective.",
    "Job retention schemes are associated with lower job separation rates.",
    "The reduction in job separations is especially pronounced among lower-productivity workers.",
    "Framework: search-and-matching model with occupational choice.",
    "Calibration target: United Kingdom during the global financial and sovereign debt crises.",
    "Targeted policy: retention scheme aimed at reducing unemployment by nearly 1 percentage point.",
    "Average welfare increase: 0.06 percent in consumption-equivalent terms.",
    "Distributional outcome: low-income workers benefit more than twice as much as the median worker by avoiding costly job switches and unemployment spells.",
    "Pages: 56",
    "Volume: 2026",
    "Issue: 015",
    "Series: Working Paper No. 2026/015",
    "DOI: https://doi.org/10.5089/9798229037884.001",
    "ISBN: 9798229037884",
    "ISSN: 1018-5941",
    "**Working Paper**"
  ],
  "related": [
    {
      "title": "Working Paper",
      "role": "paper",
      "sourceUrl": "https://www.imf.org/-/media/files/publications/wp/2026/english/wpiea2026015-source-pdf.pdf",
      "summary": {
        "path": "/-/media/files/publications/wp/2026/english/wpiea2026015-source-pdf.pdf.md",
        "mime": "text/markdown"
      },
      "binary": {
        "path": "/-/media/files/publications/wp/2026/english/wpiea2026015-source-pdf.pdf",
        "mime": "application/pdf"
      }
    }
  ],
  "alternates": {
    "markdown": "/en/publications/wp/issues/2026/01/30/the-welfare-implications-of-job-retention-schemes-573549/index.md",
    "json": "/en/publications/wp/issues/2026/01/30/the-welfare-implications-of-job-retention-schemes-573549/index.json",
    "bundleManifest": "/en/publications/wp/issues/2026/01/30/the-welfare-implications-of-job-retention-schemes-573549/bundle-manifest.json"
  },
  "generatedAtUtc": "2026-09-17T02:56:45.915Z"
}