Creaming and parking in marketized employment services: An Anglo-German comparison

Abstract

The delivery of public services by nonprofit and for-profit providers alters the nature of services and jobs, often in unintended and undesired ways. We argue that these effects depend on the degree to which the service is ‘marketized’, that is, subjected by the funder to price-based competition. Using case studies of British and German employment services, this article scrutinizes the link between funding practices and service quality. Of particular concern in marketized employment services is the problem of ‘creaming and parking’, in which providers select job-ready clients for services and neglect clients more distant from the labour market. We explore three questions. What are the mechanisms through which marketization produces creaming and parking? What are the differences between these mechanisms in commercial and non-commercial service providers? Which national institutions might serve as a buffer for the landscape of service provision facing price-based competition?