Welfare dynamics of minimum income recipients in Spain: A sequence analysis of employment and activation trajectories

Abstract This paper sheds light on the trajectories of working‐age beneficiaries of means‐tested minimum income schemes (MIS) regarding employment, activation, and benefit receipt. For this purpose, we address two main questions: What types of trajectories can be identified in the MIS in terms of spell length, access to employment, and labor activation? What factors influence belonging to a certain trajectory? Drawing on monthly administrative longitudinal data, we analyzed MIS benefit trajectories between 2016 and 2020 in Spain using sequence and cluster analysis. The results indicate a significant polarization between long‐term trajectories characterized by a substantial presence in labor activation measures and those recipients with a short spell in the program and considerable access to employment. An intermediate path is constituted by medium‐duration trajectories, with average access to employment and activation. This leads to important recommendations for program reforms aimed at adopting differentiated measures according to the type of social problems behind each trajectory.