Job Center: Opting Municipalities Are Less Likely to Place the Unemployed in Employment

In Germany, job centers are run either as “joint institutions” by the municipality together with the local employment agency or, in “opting municipalities,” by the municipality alone. The fact that 41 joint institutions were converted into opting municipalities in 2012 makes it possible to evaluate the success of the placement work under these two structural forms. The analysis shows that opting municipalities place 10 percent fewer unemployed people into the primary labor market than joint institutions. Instead, they assign more people to “one-euro jobs,” but these are not an effective way to increase someone’s chances of transition into the primary labor market.