It is a welfare state’s duty to provide for citizens without income or citizens with such low income that does not cover their basic needs. Slovenia has many social transfers to protect its citizens from poverty, one of which is social assistance benefits in cash. Many unemployed people are beneficiaries of this assistance, which can also lead to recipients becoming inactive, since working for a minimum wage is not worth it.
The purpose of this thesis is to determine what is the impact of social assistance benefits in cash among unemployed on entering the labor market and whether it encourages the recipients to seek employment or they prefer to remain inactive. The topic was studied in two different regions in Slovenia. Publicly available statistical data were used for the research.
In analyzing the statistical data, we found that social assistance benefits in cash has no significant impact on employment, as the number of unemployed people is decreasing, as well as the number of recipients. This was also observed in closely researched market of the Murska Sobota regional office, which is considered to be a region with high rate of registered unemployment and a large number of recipients of social assistance benefits in cash, and Nova Gorica, where the condition of the labor market and social welfare is below the national average.
A set of conditions need to be met in order to receive this type of assistance, however, this is not a long-term assistance that could be received indefinitely, therefore its impact on employment is minimal. We cannot know for certain how many people truly need this type of assistance and whether they are reluctant to find a job because of it. The state is already working on the issue with various incentive programs to encourage people to re-enter the labor market.
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