Prospects and challenges in employer participation in active labour market programs: the case of Türkiye

Abstract

This dissertation investigates the role of economic and institutional factors in employer participation in and withdrawal from Active Labour Market Programs (ALMPs) in Türkiye, focusing on the On-the-Job Training (OJT) Programme implemented by the public employment agency, İŞKUR. Although the OJT had been widely embraced by large enterprises since its 2009 inception due to generous subsidies, participation dropped sharply after 2021, even as economic incentives remained intact. This study explores the reasons for this reversal by combining statistical analysis of Türkiye’s 500 largest firms with 38 semi-structured interviews with human resources professionals. The research adopts a mixed-methods approach, drawing on both economic and institutionalist theories and supplemented by the Varieties of Capitalism framework. Quantitative findings show that firm-level characteristics such as export orientation and profitability are positively associated with participation. However, institutional variables, particularly proactive engagement by public authorities, were more limited in explanatory power. The qualitative findings, by contrast, uncover a critical and underexplored driver of employer withdrawal: jobseeker reluctance to participate in OJT due to low wages, insecure employment, and limited long-term prospects. This study interprets jobseeker resistance through the lens of decent work deficits, arguing that the success of ALMPs is contingent not only on employer incentives but also on job quality and worker engagement. It concludes that employer participation is conditional upon jobseeker participation, and that ALMPs cannot function without addressing systemic issues in the labour market. These findings contribute to comparative ALMP literature and suggest that future ALMP design must embed decent work principles to ensure sustainable participation.