Does Apprenticeship Improve Job Opportunities? A Regression Discontinuity Approach

In Italy the reforms of the last twenty years shaped a dual labour market with different levels of employment protection for permanent jobs, on one side, and temporary jobs like apprenticeships and fixed-term contracts, on the other side. The main difference between apprentices and other types of temporary workers is that the former should receive firm-provided training. The firm incentive in hiring apprentices consists in the possibility to pay lower wages and in a reduction in labour taxes. Using an Italian administrative longitudinal dataset containing information on all the job contracts started between January 2009 and June 2012, we estimate hazard functions towards permanent jobs and contrast the ones of apprentices with those of other types of temporary workers. The hazard function estimates based on a regression discontinuity approach affirm that apprenticeships are sorts of "long entrance halls" towards open-ended contracts, especially within the same firm where the apprenticeship was performed.