Improving the chances of the long-term unemployed : on the setting up of a Social Labour Market or of a publicly subsidized employment sector

Abstract

"Labour market research and findings from operational activities have shown that there are relevant groups of persons in the area of Book II of the Social Code (SGB II) whose chances of being integrated into regular employment are marginal. However, in accordance with the law, these persons are deliberately classified as being capable of working. Therefore, one might argue that it is necessary to create specific work opportunities for these persons. They should aim at participation in employment, social interaction, and the improvement of the health status and psycho-social well being of those concerned. The current motions of the parliamentary parties the SPD (Social Democratic Party) and Bündnis 90/Die Grünen (Alliance 90/The Greens) urge that a so-called Social Labour Market be set up in order to reach these goals. Their suggestions take into account findings from labour market research. In general, the concept of the SPD is concerned with a somewhat more employable target group than the concept of Bündnis 90/Die Grünen. From IAB's perspective a Social Labour Market may be justified, as long as the target group is narrowly defined and if, in practice, eligibility is strictly limited to members of this target group. Job centres should continue to consider integrating members from this target group into regular employment in the longer term. Therefore, it should be possible to employ target group members for longer periods of time but not indefinitely in subsidized jobs in a Social Labour Market. The passive-active transfer as a mode of financing suggested in both cases harbours the danger of creating incentives to place unemployed people into the scheme even if better alternatives are available. The suggestion of the parliamentary party Die Linke (The Left) concerning the introduction of a public employment sector extends far beyond a Social Labour Market. It does not define a narrow target group, and would create quite favourable employment conditions in this sector. In turn changing from the public employment sector to regular employment would become very unattractive. Such a strategy would imply high risks for the functioning of the labour market and high social costs." (Author's abstract, IAB-Doku) ((en))

Cite article

Kupka, P. & Wolff, J. (2013): Verbesserung der Chancen von Langzeitarbeitslosen - Zur Einrichtung eines Sozialen Arbeitsmarktes oder eines öffentlich geförderten Beschäftigungssektors. Öffentliche Anhörung von Sachverständigen vor dem Ausschuss für Arbeit und Soziales des Deutschen Bundestags am 15. April 2013. (IAB-Stellungnahme 02/2013), Nürnberg, 15 p.