The ‘Zero Long-Term Unemployment Areas’ pilot scheme: a quantitative analysis of employment-focused firms and their employees

Key findings on the economic activity of EBEs

• There is considerable variation in economic performance, with a few EBEs achieving results well above the average.
• The economic performance of EBEs is significantly lower than that of other similar private firms and appears slightly closer to that of social and solidarity economy firms (SSEs).

The research team calculated the value added per person permanently excluded from the labour market in full-time equivalent (FTE) terms, which is a key parameter in the cost-benefit analysis of the pilot scheme.

• Taking the overall average across EBEs over the period 2017–2023, the average turnover per PPDE (person permanently excluded from the labour market, i.e. an EBE employee who does not hold a managerial position) in FTE terms is €4,781.

This study also aims to measure the integration of EBE firms into the local economy. In principle, the activities of EBE firms must be supplementary; that is to say, they must neither replace existing jobs nor compete with local firms.

• This study reveals that EBEs do not pose a competitive threat to other local firms in the same sector, both because EBEs operate in sectors that are often under-represented locally, and because EBEs are very small in size compared with other local firms.
• On the other hand, the activities of EBE tend to complement the local productive fabric, and EBE are therefore generally well integrated into local value chains.
• These findings are confirmed by a dynamic analysis showing that the creation of EBE firms has had a negligible and statistically insignificant effect on local firms.

Key findings on employees’ quality of life and health

The TZCLD programme also aims to improve the quality of life and health of those involved, through the jobs they hold and the environment in which they work.

• EBE employees report a state of health comparable to that of people who have been out of work for a long time, as observed in the ‘Statistics on Resources and Living Conditions’ (SRCV) survey produced by INSEE, whilst being younger on average. EBE employees are generally in poorer health than the general population: they are more prone to chronic illnesses or long-term health problems, and face greater limitations in their day-to-day activities.
• The level of subjective well-being among EBE employees is also similar to that of the long-term unemployed, and they more often feel lonely.
• All other things being equal, people who are currently employed or were previously employed in EBE report being satisfied with their lives in general more frequently than those who have left the ‘Integration through Economic Activity’ (IAE) – that is, a network of organisations committed to hiring, on a temporary basis, people who are very far from the labour market. They also feel that their situation has improved since joining an EBE, whereas those leaving the IAE programme consider their situation to be comparable to what it was before. These effects are mainly driven by people who were very far removed from the labour market before joining an EBE. EBE employees are more likely to have undertaken at least one training course than those leaving the IAE, generally ‘to do their job better on a day-to-day basis’, whilst those leaving the IAE are more likely to undertake training leading to a qualification.
• The TZCLD pilot scheme appears to help identify individuals who are very far removed from the labour market and who face exclusionary factors (health problems, social isolation) that prevent them from entering the labour market, or even from benefiting from certain schemes such as Integration through Economic Activity. Women and people born abroad are less likely to face these barriers when joining the EBE. Some individuals appear to face difficulties that are too great to allow them to participate in the TZCLD pilot scheme, leading them to leave the EBE.