ARTEFACT

Abstract: https://journals.sagepub.com/doi/abs/10.1177/00420980211006033

Among all the public policies targeting deprived neighborhoods, the "Emplois Francs" scheme explores an original approach. Rather than encouraging local economic development, the idea is to subsidize companies, regardless of their location, as long as they employ people living in deprived neighborhoods, which are officially delimited in France. Since 2018, this new policy has been rolled-out  in nearly 200 districts.

Our study evaluates the effect of this policy by using three waves of correspondence tests spaced six months apart to measure discrimination in access to employment based on ethnic origin and place of residence.  As the "Emplois Francs" policy is designed to fight discrimination in access to employment on the basis of place of residence (and ethnic origin), the correspondence test method seems particularly appropriate to evaluate its effects.. We find significant and robust hiring discrimination on the criterion of ethnic origin against  a fictitious candidate of North African origin in all test neighbourhoods  for three occupations tested: his or her response rate is almost 40% lower than that of  an applicant of French origin. We find a lower level of discrimination against the place of residence. After six months, “Emplois Francs” increases by 3.3 percentage points the response rate to the applicant in the deprived neighbourhoods relative to the applicant in the non-deprived neighbourhoods. However, the strength of this  effect decreases between the second and third waves.

We believe that this study shows that the “Emplois Francs”program, targeting the unemployed in deprived areas, can be effective in reducing the gap between these areas and the rest of the country. Second, it suggests that a particular difficulty with this type of program is its take-up by recruiters. The allowance for hiring an unemployed individual has to be claimed by the employer and the number of allowances delivered is much lower than the total number of eligible cases. The reason for this limited take-up remains an open question. It does not appear to be related to the amount of information held by the employer. When the fictitious candidate provides explicit and clear information directly to the employer on how the “Emplois Francs” scheme works, his or her chances of success do not improve significantly. The reason may be a lack of employer interest in the allowance: the employer may expect the cost of applying for the allowance to be higher than the allowance itself. In this case, one solution may be to automate the subsidy.

Read the accompanying article on Urban Studies OnlineFirst here.