Contracting out placement services in Germany: is assignment to private providers effective for needy job-seekers?

Sarah Bernhard and Joachim Wolff

No 200805, IAB-Discussion Paper from Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]

Abstract: "Contracting out placement services aims at enhancing the effectiveness of placements of unemployed job-seekers through market mechanisms. This paper analyses the effectiveness of the temporary assignment of needy job-seekers to private placement services by comparing their outcomes with respect to employment, unemployment and benefit receipt with those of a suitable control group. Using recently available administrative data we apply propensity score matching to construct the control group. We regard a period after a policy reform in 2005 that introduced a new means-tested benefit, the unemployment benefit II, and emphasized the activation of needy unemployed people. Hard-to-place job-seekers usually need more effort to be placed into a job. Therefore it is an interesting question whether groups of people with different a priori employment probabilities benefit to a different extent from an assignment to a private placement service. To answer this question we analyse several subgroups separated by sex, age, migration background, occupational education and time since the last job. Our results suggest that in some cases the assignment to private providers is relatively more effective for groups of job-seekers who are rather hard to place. Despite positive employment effects for some subgroups, however our results imply that the assignment to private providers is generally ineffective and in some subgroups counterproductive regarding the goal of avoiding unemployment and benefit receipt." (Author's abstract, IAB-Doku) ((en))

Keywords: Bundesrepublik Deutschland; berufliche Reintegration; Beschäftigungseffekte; Erfolgskontrolle; Hartz-Reform; IAB-Leistungsempfängerhistorik; Integrierte Erwerbsbiografien; private Arbeitsvermittlung; Privatisierung; schwervermittelbare Arbeitslose; Arbeitslose; Vermittlungserfolg; Vermittlungsgutschein; Zielgruppe; Arbeitsuchende; Arbeitsvermittlung; 2005-2007 (search for similar items in EconPapers)
JEL-codes: C13 H43 J68 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2008
New Economics Papers: this item is included in nep-lab
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Citations: View citations in EconPapers (38)

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Persistent link: https://EconPapers.repec.org/RePEc:iab:iabdpa:200805

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