Long-run Employment Effects of Vocational Rehabilitation

Previous studies find that vocational rehabilitation in terms of education has no or even a negative effect on long-term sick-listed employees’ probability of returning to work. This paper extends previous analyses by assessing the employment effect, using both a return-to-work measure and a measure of the subsequent employment duration. With data on 637 Danish long-term sick-listed employees, we simultaneously estimate a random effects hazards rate model comprising four durations: (1) the duration until participation in an educational measure, (2) the duration until returning to work for the pre-sick leave employer, (3) the duration until returning to work for a new employer, and (4) the duration of the employment after returning to work for a new employer. In line with previous studies, we find that educational measures have a negative effect on the sick-listed employees’ probability of returning to work for a new employer. However, our findings do not support the hypothesis that educational measures increase the employment duration of sick-listed employees after they have returned to work for a new employer.