EUROPEAN COMMISSION

Employment, Social Affairs and Equal Opportunities DG

Employment, Lisbon Strategy, International Affairs

Employment Services, Mobility

Approaches of Public Employment Services (PES )

to Long Term Unemployment

Draft report from seminar in Budapest

22-24 March 2006

Brussels, May 2006

European Commission
Directorate General Employment, Social
Affairs and Equal Opportunities
Unit EMPL.D.3
Employment Services, Mobility

1
Content:

1 The EU seminar on PES approaches to Long Term Unemployment

2 Programme

3 PES approaches to LTU in a European perspective

3.1 Meeting the requests of the Employment Guidelines / Johan ten

Geuzendam
3.2 ILO approach to support the actions / Franz Gundacker

4 Are there effective methods to prevent LTU?

Country reports:

5.1 United Kingdom / Nicola Gilpin

5.2 Belgium – VDAB / Dorine Samyn
5.3 Slovakia / Stefan Grajcar
5.4 France / Annie Gauvin

5 Does the organisation of PES affect the success of dealing with LTU
Country reports:

6.1 Finland / Robert Arnkil

6.2 United Kingdom /Eamonn Davern
6.3 The Netherlands / Theo Keulen

6 Are PES up to the job?

Country reports:

7.1 Belgium – Le Forem / Sylvie Osterrieth

7.2 Italy / Germana Di Domenico
7.3 Ireland / Celia Flynn

7 Conference results

8 Follow-up

This report was prepared by Elisabet Arp, DG EMPL.D.3, in collaboration with Els
Van Winckel, DG EMPL.D.3 and with the PES expert working group preparing the
seminar.
A special thanks to all speakers for their useful input at the seminar, and for the
material they prepared for the presentations. The European Commission would also
like to express the gratitude to the Hungarian PES hosting the event.

This report contains the opinions of the experts formulated at the seminar in
Budapest, 22-24 March 2006 and does not necessarily reflect the opinion of the
European Commission.

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1 The EU seminar on PES approaches to Long Term Unemployment (LTU)

Following the launch of the European Employment Strategy in 1997 with the clear objective
of reducing unemployment in the EU, the Heads of Public Employment Services (PES)
Network addressed the issue of LTU in the late 1990's and issued a working paper on the PES
service model for LTU. That paper was the culmination of work done by a PES expert group
that focused on LTU issues. In recent years the phenomenon of LTU has come to the fore
again. With unemployment reaching 10% + in some of the major European economies, the
Heads of PES Network have requested that we look again at how the PES approach to LTU
can be maximised. Lessons have been learned over the past two decades and some useful and
interesting research into the impact of PES activities/programmes on LTU has been carried
out. The Assistants to the Heads of PES proposed a working group ranged from both to focus
on the EES policies and to a need to engage in the exploration of practical measures and
exchange of best practice.
In order to promote the exchange of experiences supporting PES performance in relation to
the European Employment Guidelines, it was proposed by the working group to organise a
seminar for the exchange of practices and the knowledge-sharing between European PES. In
November 2005, the Heads of PES meeting discussed the organisation of a seminar and
agreed upon it. The seminar should preferably focus on sharing successful practices from
Member States to fight LTU.

2 Programme

The seminar which was initiated by the European Commission, took place in Budapest on 22-
24 March 2006. After the introduction - EU Commission, ILO, Hungarian hosts -, the
seminar focused on 1) the prevention of LTU (see point 4 of this report), 2) the effect of
organisational issues on results (point 5 of this report), and 3) whether the PES manage better
or not when dealing with LTU in cooperation with other organisations or not (point 6 of this
report). Country presentations and experiences were discussed in break-out sessions and
around 70 participants from 21 European PES attended the seminar.

3 PES approaches to LTU in a European perspective

3.1 Meeting the requests of the Employment Guidelines / Johan ten

Geuzendam, European Commission

Mr. Johan ten Geuzendam opened and introduced the seminar.

Surveys across Europe show that jobs are the most important political issue for citizens. Long
term unemployment is a crushing experience for most people. Tackling it is a top priority.

PES approaches to Long Term Unemployment is an important subject, as the European

Employment and Lisbon Strategy have a strong focus on Long Term Unemployment. There
is a clear focus on reducing unemployment in the European Employment Strategy, since
1997. It is a key element of the Lisbon Strategy. The new integrated Strategy adopted in
Spring 2005 contains an ever stronger emphasis on growth and jobs.
In the new Integrated Guidelines for Growth and Jobs (2005-2008), which incorporate the
new Employment Guidelines for 2005-2008, guideline 19 refers explicitly to "Ensuring
inclusive labour markets, enhance work attractiveness, and make work pay for job-seekers,
(…) through active and preventive labour market measures including early identification of
needs, job search assistance, guidance and training as part of personalised action plans,

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provision of necessary social services to support the inclusion of those furthest away from the
labour market and contribute to the eradication of poverty, (…)."
Guideline 20 mentions explicitly "the need to improve matching of labour market needs
through the modernisation and strengthening of labour market institutions, notably
employment services, (…) better anticipation of skills needs, labour market shortages and
bottlenecks (…)."

Based on its analysis of the 25 National Reform Programmes, the Commission has asked EU
leaders to commit themselves, at the Spring Council in March 2006, to specific action in the
four key areas of jobs, knowledge, enterprise and energy.

In the context of the European Employment Strategy, important targets and benchmarks were
agreed in 2003 :
- that every unemployed person is offered a new start before reaching 6 months of
unemployment in the case of young people and 12 months in the case of adults in the
form of training, retraining, work practices, a job or other employability measure,
combined where appropriate with on-going job search assistance;
- that 25 % of long-term unemployed should participate by 2010 in an active measure in
the form of training, retraining, work practice, or other employability measure, with the
aim of achieving the average of the three most advanced Member States.
- that jobseekers throughout the EU are able to consult all job vacancies advertised
through Member States' employment services.

Mr. ten Geuzendam reminded the participants that the work in this seminar is linked to the
seminar "Profiling for better services", which took place in Nuremberg, on 12-14 January
2005. In the profiling seminar, different countries' approaches to profiling were presented,
which gave rise to assessment of their transferability to improve employment services. During
the seminar, it was agreed to intensify the exchange of experience and turn the new insights
into innovation. This is how to proceed: by organising a peer review, mutual learning and
exchange of information to look at good and effective approaches.

The objective of the seminar is to review what works, what is new in approaches to LTU, how
to measure the outcomes more effectively, and which suggestions for practical solutions are
transferable across PES. One of the major questions is: "Do PES make a difference in the
reduction of LTU ?". This is strongly related to the performance issue. There is a growing
need to establish the effectiveness of measures aiming at reducing LTU in a more accurate
way. In this context, questions are raised such as: how to provide effective guidance and
counselling so that opportunities provided match the particular needs of the LT Unemployed.
Which measures are effective? What does actually work? The aim of the seminar is to
discuss these questions, also in terms of efficiency and effectiveness.

3.2 ILO approach to support the actions / Franz Gundacker, ILO

Mr. Gundacker presented some experience on employment policies and institutions from
areas beyond the European Union; i.e. South East Europe which includes new Member States,
Candidate Countries and other countries beyond. Many countries in this area are still suffering
from persistent unemployment and wait for the growth of employment. Many also suffer from
the effects of the transition from a command to a market economy. Some particular
difficulties are the transition from old institutions and policy patterns, persistent
unemployment, low labour mobility due to transport problems and housing market rigidities.
Above all that, spending on social security as well on social services has been reduced, thus
poverty, including the constant increase of the working poor, is a pressing issue.

For ILO, all work on employment policies is closely linked both to social policies (e.g.
pension reform) as well as to social dialogue. However, many of the social partners in the

4
area are weakly organised, with the trade unions still suffering from a bad reputation from the
period of state trade unions, so the social dialogue is a paramount issue for the ILO, as it is
considered a precondition for good governance, including a strong focus on cooperate social
responsibility. To implement its mandate at the national levels, the ILO has developed its
'decent work strategy’, in which the promotion of rights at work, the emphasis on access to
employment, on social protection and on social dialogue converges.

With regard to long-term unemployment, Mr. Gundacker highlighted three aspects of the
ILO’s work in Central and South-Eastern Europe:

1) The use of the ILO’s KILM system (key indicators for the labour market)
Among the 20 key indicators, two indicators are developed in order to better understand the
mechanism by which people become long-term unemployed and to understand poverty as an
outcome of the functioning of labour markets.

2) The ILO’s “Flexicurity project” which consists of a study carried out in selected countries
(Poland, Hungary, Bulgaria and Lithuania) to identify the relation of labour flexibility and
employment security, as well as of national tri-partite seminars, which bring governments,
workers and employers together to discuss good combination of different needs for flexibility,
stability and security.

3) The “Bucharest Process”, an open method of coordination of employment policies in South

Eastern Europe, to address employment challenges and share good practice. This is a process
which is similar to the European Employment Strategy among EU member states. The ILO,
together with the Council of Europe, give advice to governments in designing National Action
Plans, assesses them regularly and develops policy recommendations for further
implementation.

Summarising ILO as well as OECD experience on employment policy evaluation, Mr.

Gundacker pointed to the difficulty to identify real impact as mostly program evaluation
instead of target oriented policy evaluation is available. “Lock-in” effects of programs yield
measurable impact sometimes only years later. Structural factors like volume, PES, benefit
regime as well as program implementation matter more for long-term unemployment than
cyclical factors do. Early intervention strategies, combined with active measures, as well as
clever combinations of labour flexibility and employment/social security has impact in a good
way on long-term unemployment.

Three key areas for intervention against long-term unemployment are

- The focus on entry problems (guidance, activation)
- The focus on mismatch on labour market (guidance, training)
- Combinations of methods tailor-made for the individual (package deals).

The Public Employment Service plays a key role and makes a real difference for the
management of the labour market change. Countries with a good cooperation between
partners such as the Public Employment Service, the social services and the social partners
seem to perform better than others. However, staff case-loads are a critical factor and may
become a constraint to PES performance.

4 Are there effective methods to prevent LTU?

Country reports:

4.1 United Kingdom / Nicola Gilpin, Department for Work and Pensions, UK

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The employment rate in the UK is currently 74.5% and is one of the highest in the EU.
Despite some recent increases, the level of registered unemployment in the UK is at a level
not seen since the mid 1970s. A long period of economic stability has contributed to this
strong labour market performance, but evidence shows that the UK’s active labour market
strategy has also played an important role in the improvement in the labour market in recent
years.

The UK’s focus is on helping those people who find themselves out of work, back into work
as quickly as possible and is usually referred to as a "work first approach". The UK’s Public
Employment Service – Jobcentre Plus – is central to delivering this strategy. Jobcentre Plus
brings together the payment of all working age benefits and job search assistance into a single
point of delivery. It has transformed the way the UK delivers welfare and has improved the
services on offer to all customers.

The two key elements of the UK's active labour market strategy (delivered through Jobcentre
Plus) are: the Jobseeker's Allowance and the New Deals.

The Jobseeker's Allowance is the bedrock of UK's active labour market system. It is designed
around the individual and is fully focused on the labour market. The aim is to promote
continuous job search amongst the unemployed. Jobseekers develop a "back-to-work-plan",
regular attendance at the Jobcentre is mandatory and individuals must demonstrate they are
actively seeking work. Jobseekers are helped through a series of compulsory work focussed
interviews. This approach means that most people leave the unemployment register within 6
months (around 80%), helping to prevent LTU.

For those who do become long-term unemployed help is available through the New Deals.
The New Deals offer a period of intense counselling and support followed by a number of
options (training, work experience etc) if the individual is unable to find work. The New
Deals are mandatory for those on the Jobseeker’s Allowance and there is no option to do
nothing. The New Deal approach has been successful in reducing long-term unemployment,
particularly amongst young people and is being extended on a voluntary basis to groups
further away from the labour market.

The UK approach is labour intensive as it is built around frequent contact with clients, but has
proved to be both affordable and effective. OECD evidence shows that job search assistance
strategies often have a large impact on unemployment and that their cost is relatively low.

Key success factors within the UK system are considered to be:

- Jobcentre Plus, combining the payment of all benefits with active labour market help in a
single point for delivery
- Jobseeker’s Allowance, which promotes continuous job search, and which is built around a
system of specially trained advisers and work focused interviews.
- Rights and responsibilities; people have a responsibility to actively seek work.

The future challenge for the UK is to raise employment even further and to bring groups who
are further away from the labour market, such as people on incapacity benefits, closer to the
labour market.

4.2 Belgium – VDAB / Dorine Samyn, VDAB

VDAB works with a well-defined systematic approach to prevent long-term unemployment

which and is mainly influenced by:

- The European Employment Guidelines

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- The Belgian unemployment regulation, who assigns the National Employment Office with
the control on jobseekers
- The task, charged by the Flemish Government, to provide placement, guidance and training.

This involving, comprehensive approach called for offering a new start according to the
European Employment Strategy to young unemployed before reaching 6 months
unemployment and to adults before reaching 12 months. Each long-term unemployed is
offered a new start every 2 years. This involving approach is integrated in the management
contract between the VDAB and the Flemish government.

The basic assumptions in the involving approach are:

- The 'work first approach' and to meet with the employers request and expectations to have
well-skilled persons on vacancies
- The automatic delivery of job offers by a computerised system started in 2004 and
- The early identification of problems and immediate action to meet with the identified
problems of the individual jobseeker.

Since 2002, VDAB has invested in work-shops which are local offices where all capacities
around the jobseeker are gathered together. This can be non-profit organisations, social
benefits organisations and the VDAB in cooperation.

The systematic approach to prevent LTU has several steps:

• Registration and matching services where the purpose is that no jobseeker should leave an
appointment without having received vacancies that fit him.
• Automatic delivery of job offers during the whole period of unemployment by a
computerised system. The data in the personal files of de jobseekers are weekly matched
with the recent job vacancies. The jobseekers receive those appropriate job offers by mail
or e-mail.
• Telephone screening by the Call Centre, which is a new feature since 2004; this service is
practiced after 3 months for younger jobseekers and after 6 months for adults. The
activity includes an update of the personal files and a follow-up of the job search as an
analysis of the jobseeker whether there is a need for extra support. If so, the information
on where to find these services is provided. Jobseekers should by this service be
stimulated to job search, and if necessary, lead him/her to further services.
• Intake and counselling by a VDAB consultant, which is offered three months after the
telephone screening. This analysis will find out if training or guidance is needed for the
jobseeker.

Moreover, the VDAB started in 2004 to present every long-term employed, who shall be
summoned by the National Employment Office, an offer for guidance. This curative approach
also follows several steps:
• Orientation centre: collective sessions for the re-activation of the jobseeker through
information, orientation and motivation.
• Intake and Counselling by VDAB or private organization.

4.3 Slovakia / Stefan Grajcar Central Office of Labour, Social Affairs and Family

The Slovak Republic has a very high unemployment rate although it has been substantially
reduced over the recent years. The long term unemployment rate is also at a very high level
and the amount of jobseekers registered for more than twelve months is slightly increasing.
Among these jobseekers, about half has been registered for more than four years.

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In order to handle this situation, the Slovakian PES has merged with the social offices to be
able to offer all services to the citizens at one spot. Another approach to deal with the high
unemployment rate has been developed in cooperation with the Netherlands seeking a way to
diversify services between jobseekers according to their situations.

A specific project on employment issues was launched in 2003 with four focuses:
- To develop an operational profiling system
- To strengthen the institutional capacity on central level in the field of guidance
- To strengthen the district offices to be able to provide career information and
counselling services
- To support a preventive approach in PES work

The principles of the profiling project were to divide jobseekers into groups according to data
collected and analysed according to a statistical model developed for each office separately.
According to this data, clients are profiled and divided into two groups; persons with a low
risk to become long term unemployed and persons with a high risk of becoming long term
unemployed. While self services and measures not so time consuming are offered the first
group, individual action plans and a qualitative intake are offered the second group. If the
person after a period of six months still is unemployed, the process is repeated.

This project was carried through in one pilot district and evaluated and assessed during 2005.
It has now been decided to use the experience and implement the new methods also in other
districts of the country.

4.4 France / Annie Gauvin, ANPE

In order to enhance the possibility for more people to enter into work, ANPE is currently
establishing a totally new system with the enhancement of preventive, closer and personalised
contacts with the jobseekers.
France has today an unemployment rate of 9.5% and of these around 30% has been registered
for more than 12 months. The trend during 2005 are positive: unemployment decreased by 5,2
% and long term unemployment decreased by 4,8 %.

Influenced by the European Employment Strategy in 1998 and in 2001, France has during the
last years practiced a personalised system for a new start for jobseekers. This was completed
in 2006 with a personalised system of follow-up for job-seekers also trying to integrate all the
institutional and operational players around the jobseeker.

In this earlier approach, an interview with the jobseeker was carried through within maximum
of 20 days after the registration and the interview resulted in a diagnosis of the autonomy of
the jobseeker and the level of services needed. ANPE services were multiplied during this
period and another important part of this preventive approach was also the higher contact with
the employers.

When assessing this approach, it was found that only 5% of those who are still registered after
24 months have used self services and less time consuming services for the PES, while 60%
of jobseekers who were still unemployed have received more support and more intense job
search assistance.

The assessment also clarified that unemployment and long term unemployment decreased
when using the above mentioned tools. Some of the main factors for these achievements are
that ANPE changed the level at which it tried to help the jobseeker and made an effort to
reach as many jobseekers as possible. A big difficulty is the large amount of jobseekers and
ANPE has therefore more standardised the services possible to offer. The jobseekers

8
expressed that they would prefer to have the same counsellor to contact within the PES and
this is now taken into consideration in the new personalised plan 'helping people back to
work.'
The new approach builds on the principle that the correct service should be allocated for the
right person at the right moment and is current practiced in a pilot project. The main
objectives are to:

- Reduce the time between registration and the first interview at the PES. The aim is
to have fulfilled this interview within seven days (and five days from next year)
- Increase the frequency of contacts between the PES and the jobseeker (at least monthly
frequency contact, and this contact will take place with the same adviser each month).

A monthly personalised follow-up will be offered to every jobseeker from the fourth month of
registration, and the jobseeker will have one counsellor which remains the same contact
person within PES.
In the pilot sites, the risk population will also be identified by the use of profiling techniques.
A statistical model for this is developed which offers the possibility to early identify risks for
long term unemployment and good or low employment prospects. An individual development
plan is the result of the profiling, identifying what areas that are necessary to focus on to close
the gap between the jobs available and the jobseeker.

Three different levels of risks for long term unemployment and level for employment
prospect are defined within the new system;

- Limited risk to become long term unemployed (and high employment prospect)
- Average risk " " "
- High risk " " " (and low employment prospect)

Once the level is identified, ANPE can decide on services for the individual (back to work
plan; counselling; training; work experience) and also on future directions.
Mainly three main directions are identified for the following services:

1 A quick job-search model : where the jobseeker and the PES adviser meet 4-6
times for three months. The objective is to offer various jobs and to share
information on how to look for jobs (work shops, contacts with employers,) and
how to apply for these.

2 Actively looking for a job: monthly follow-ups of jobseekers starting after 4

months of registration. This supported job search can be provided by ANPE or by
partners. The objective of the activity is to minimize the risk for persons to
become long term unemployed.

3 More intensive guidance and following up: where a narrow personalised is

developed by ANPE with partners or only by specialized partners on tenders with
ANPE and UNEDIC. This is a monthly or a more intensive follow-up and
counselling and jobseeker’s service and process, during 3, 6, 9 or 12 months,
depending on the need of the jobseeker.

This new approach for a new delivery service model from ANPE builds on the principle of
early and more frequent intervention, and therefore the resources at PES are also allocated by
this principle.

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5 Does the organisation of PES affect the success of dealing with LTU
Country reports:

5.1 Finland / Robert Arnkil, Arnkil Dialogues, Finland

Finland has a decreasing unemployment and also a long term unemployment that heads this
direction. Some current Finish PES challenges are the generation change, the high
dependency of global export market and the changes within the municipalities with which the
cooperation is very important as these are strong local governments with great autonomy.

The Finnish PES is in a second wave of changes and the experience from the first part, started
already during the late 90's, show that there is today established a favourable platform for
delivery for the Finnish PES.
While the first wave of changes concentrated on rationalisation, activation and clarifications
of rights and obligations of jobseekers, the focus of today is mainly on two strands:
addressing structural unemployment and long-term unemployment with new service models
and enhancing job-seeking and employer services by reforms in the PES offices. There is also
an emerging third strand, addressing workplace development and social innovations both in
the private and public sector. An example of this is age management, since in the next decade
the generation change will be in full swing and changes in demand and recruitment imminent.

Some identified challenges for the services to combat long term unemployment is to focus
better on each client, and that standardised services have played out its role. The new Finish
model can be described as a 'networking model', trying to establish a better contact between
PES, social work and health (especially in municipalities) and sub-contractors (private and
third sector) for special focussed services and customer groups.
Labour Force Service Centres are set up as a separate unit to complement the work of the
PES. These are run in cooperation with the local municipalities. The officials work as pairs,
thus uniting a labour-market perspective and a social/family/everyday-life perspective on
helping the client. The clients that need a more holistic service are referred to the new Labour
Force Service Centres as they could really benefit from the network cooperation. A first
evaluation of the new approach shows that they are well received by customers and enjoy a
high level of customer satisfaction.
A strong and qualified start is emphasized in the new Finish model with a good initial
assessment at PES followed by a differentiation of network services including the new Labour
Force Service Centres. Parallel to this, a good self-service system is necessary to support this
new approach.
Key objectives in the overall Finish reform are better anticipation of the labour market and
better contacts with the employers.

This network strategy with a strong cooperative component with the municipalities has some
critical success factors:

- Customer contacts and the assessment need 'smart profiling' (i.e. a flexible and
individualised approach)
- Group quality case management has to be developed as customer flows become
more complex
- Continuous need for development of service markets in which the municipalities
play a major role, coupled with new capabilities of officials in “smart buying” from
subcontractors
- The management of the new Labour Force Service Centres is the responsibility of
both PES and the local municipalities, which is a complicated steering structure.

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5.2 United Kingdom / Eamonn Davern, JobcentrePlus, UK

A mayor UK challenge during the last 5 years has been to change the Public Employment
Service into a modern organisation working more efficiently, and integrated with the benefit
delivery service, to meet customers' needs and to move people back to work in the most
effective way.
This change is a transition from a principle of providing what Government assumed that
clients required to building a service delivery model based on what best meets the needs of
the customers. Through building on this approach the integrated Jobcentre Plus organisation
has actively worked to deliver the UK government’s policy of "work for those who can and
support for those who cannot."
The earlier system, with a separate PES and benefit delivery organisation, was considered
overly bureaucratic with much duplication, and complicated for its service users. While the
PES focused merely on jobseekers, the Benefits Agency dealt primarily with passive, inactive
groups receiving other welfare benefits due to for example sickness, or being single parents.
This separation of tasks did not promote delivery of ambitious employment goals. Jobcentre
Plus has been required to work even harder promoting the employment of inactive customers
and through this, as part of working on the Lisbon agenda, it has supported development of
social capital with a wider remit than the previous role of only managing the treatment of
unemployed people.
This change meant not only a different structure, but also changing the organisational culture.
The message would be to expect active job search from unemployed customers in return for
government support for these jobseekers so that they could fulfil this expectation. Building
upon a change of definition from unemployment benefits to 'jobseekers allowance' individual
counsellor targets were introduced to enhance the focus on needs of priory customers.

The three pillars in the UK approach are:

1 Supply Pillar
Jobcentre Plus expects jobseekers to actively seek available jobs and requires all unemployed
customers to meet with a counsellor every two weeks to describe what they have achieved. It
is strongly felt that these frequent contacts are significant factors in the successful delivery of
labour market policy. As a result of this approach 80% of the customers come back to
employment within 6 months of becoming unemployed.

2 Demand Pillar
It is crucial to have good contacts with employers and special attention is paid to them by
specially trained staff at Jobcentre Plus.

3 Partnership Pillar
The cooperation with partners is fundamental to be able to meet with the requirements of a
rapidly changing labour market. Jobcentre Plus therefore cooperates with partners from the
private sector, with non-profit organisations, and with voluntary organisations in order to
reach its objectives.

The result of this change within the UK has been to deliver very successful outcomes.
Frequent and rather inexpensive interventions from counsellors with all customers from the
start of their unemployment has re-enforced the message that work is the best form of
welfare. A merged organisation with a single management structure has provided a clearer
strategic focus, and ensured that customers are able to quickly resolve their income support
queries enabling them to then focus on the employment agenda.
Jobcentre Plus delivers part of a wider Government welfare reform agenda which includes
provision of financial support through Tax Credits for people moving from unemployment
sometimes into lower paid jobs, measures to support the employment of disabled people, with
support for both customers and employers, and a programme to subsidise child care costs.

11
Jobcentre Plus counsellors are able to offer advice to customers on this integrated package of
in work support available demonstrating to customers that the policy now ensures that all are
better off in work.

The UK has embraced the policy of moving on from a focus on unemployment to

employment mirroring the move from the Luxembourg to Lisbon agenda. It is by attracting
these previously passive groups into the labour market that the UK can move beyond building
its success in meeting Lisbon targets, to reaching its long-term aspiration of achieving an 80%
employment rate. Whilst of course different systems are suited to individual countries
specific circumstances, the Jobcentre Plus process has proved most successful for the UK in
delivering its labour market and employment policy.

5.3 The Netherlands / Theo Keulen, CWI

The Dutch Public Employment Service, Central Organisation Work and Income (CWI), was
established in 2002 in the framework of restructuring the social security and employment
services of the Netherlands. CWI is the first part in a chain of service delivery, a chain where
PES, municipalities and the Public Employers Insurance Agency have clearly divided
responsibilities. CWI is responsible for placement services which include job search and
search support to the individual. Support for the application of benefits is also provided, and
another role is to advice the partners in the chain on how to re-integrate customers into labour
market.

The Dutch PES has no responsibility and no resources for re-integration, for active labour
market policies and for the payments of benefits. The re-integration services are delivered by
private companies, which have to bid on tenders by municipalities and by the social insurance
board.
The CWI is assigned to shorten the dependency of benefits and tries to achieve the shortest
way back to work for the individual, and the mission of the Dutch PES can be described in an
Economic goal: To strengthen the dynamics of the economy by contributing to a good
functioning of the labour market and in a
Social goal: to promote labour market participation as much as possible.

The individual responsibility is an important principle in the Dutch system, therefore self-
services are well developed. An early profiling model, the phasing system, was introduced
some years ago, but the CWI will now leave this approach as the experiences show that it
focused too much on barriers. In a coming approach, the capabilities of the individual to
search employment will be emphasised which is expected to deliver a much more flexible
profiling system.
Another upcoming change is a stronger cooperation with the municipalities, and the
government has approved of this more individualised approach and support to the jobseeker.
The results of the efforts by the Dutch PES are measured in two key performance indicators
and since 2002 the results by CWI have increased. The results of the efforts by the
reintegration market aren’t impressive . Only 35% of those entitled to unemployment benefits
are integrated into labour market. The focus on prevention and outflow at an early stage
seems effective and the assessment of compliance and job search are effective.

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6 Are PES up to the job?
Country reports:

6.1 Belgium – Le Forem / Sylvie Osterrieth

The labour market in Wallonia has a great diversity and a fragmented approach towards
unemployed with several regional and local players. The unemployed person in Wallonia has
the possibility to choose his service provider and the PES cannot influence this.
The task of Le Forem is to be the overall coordinator of the different actors in the field of
offering services to jobseekers.

From 2004, the role of Le Forem has changed radically as there was no obligation earlier for
the jobseeker to participate in a plan (except for specific target groups). Now, Le Forem is
following up plans for almost every person receiving an allowance. At present, Le Forem
meets with the jobseekers and decides with him what is to be done (action plan), and the
federal agency in charge of the allowance is informed about his (non) participation in this
meeting or action plan.

Le Forem makes a 1st identification of the needs for jobseekers that are classified in 4
different groups in relation to the job-readiness. When it comes to the provision of the
services following to this identification; these are mainly provided by the private (non profit
or profit organisations) and public partners. The role of Le Forem in this sense is to explain
the services to the unemployed and to give advice:
PES has the task of explaining the services possible to the jobseeker and to support a
transparency on the possibilities for the individual.
Secondly, Le Forem is in charge of the follow-up of the various actions, training, etc. that
undertakes the jobseekers in order to insure that it brings him to employment.
Thirdly, Le Forem also has the role of collecting as many vacancies as possible and to
disseminate these to a large public. More than 250 sites are used for advertisements of
vacancies in combination with personal approaches by the use of phones, SMS, etc.

The objective with the new system is also to create more services both by public and private
providers in order to match the needs of jobseekers. Therefore, Le Forem analyses the market
and stimulates the development of specific services by different means (call for tenders,
discussions with them…).

This new approach for Le Forem is still not completely settled, but several advantages are
noticeable when working with partners;
- Increased geographical flexibility – players can be found on many spots of the region,
- Methodological advantages with many actors,
- Closer to the public,
- Possibility to multiply the offer of services.

Concerning results, the ambition was to come closer to people and to make them come to the
PES which is also the case today. The partners are increasing in number which is considered
as a sign of good cooperation. On methodology, it could have been more innovative and the
results also show that jobseekers who started to use the services of the contracted partners
they stayed along well and kept to the programs.

6.2 Italy / Ms. Germana Di Domenico, ISFOL

A big modernisation process to reorganise the PES took place in the late 1990's in accordance
with the new European approach to the Employment Strategy.
The Italian PES reform followed two key principles;

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- The abolition of public monopoly on job placement towards a more competitive and market-
oriented approach with greater involvement of private players and other stakeholders
- According to the subsidiary principle, the decentralisation of the policy planning as well as
provision of services changed from a state responsibility to an issue for the regions (21) and
the provinces (107).

The regions and provinces are in charge of their own local employment offices/job centres,
while general guidelines, performance indicators and basic standard services to be guaranteed
are designed at a central level by the government. Local policy planning and organisational
systems are provided by the regions which also make their own choices through specific laws
defying requirements to be met on potential public and private providers for the services
needed.

A monitoring activity on performance is regularly fulfilled by ISFOL on behalf of the

Ministry of labour and Social Policies. This monitoring pays a special attention to how LTU
is dealt with in local job centres and also an evaluation whether this issue should be treated by
PES or in cooperation with other stakeholders. The Italian PES has no tasks to fulfil on social
security, but as the individual jobseeker after a period of unemployment of 12 months
receives no benefits, it is in the interest of PES to develop fruitful partnerships that could help
the jobseeker not to become long-term unemployed.

While job centres are homogeneously spread over the country, private providers mostly
operate in more dynamic and developed parts of the country. The most recent labour market
Reform entered into force by the end of 2003 and has enabled other players like Trade
Unions, Municipalities, Universities, Schools, etc. to actively operate for job placement and
other complementary services that PES tend to contract-out.
A very wide network of players has made therefore a holistic approach to address target-
groups at higher risk of LTU possible and a key role for the PES system at local level is the
right to build and promote these partnerships to fight unemployment and long-term one.
Partnerships and outsourcing also allow reducing workload for PES staff allowing them to
concentrate on people mostly in need and hardest-to-place, by what is called “case
management” approach to the long-term unemployed target.

Italian PES activities addressed to LTU are combined measures resulting into tailor-made
services defined through a selective client approach. A significant gap between active labour
market policies and welfare measures still needs to be filled as well as a stronger connection
of PES with the social security system has to be built.

Concerning results, the decentralisation is considered as effective as it allows adapting

employment policy tools to labour market needs but a strong central coordination is needed.
The jobseeker can benefit from different kinds of services but a larger amount of good
cooperation between private and public players should still be stimulated as well a good
quality control and medium to long-term policy evaluation, mainly in terms of stable
employment once left the benefit system.

6.3 Ireland / Ms. Celia Flynn, FÁS

The Irish Economy

Over the last decade the Irish economy has performed exceptionally well. The size of the
economy, as measured by Gross National Product (GNP), has doubled and employment has
grown by over half a million. The unemployment rate remains one of the lowest in the EU
and per capita living standards have increased by about 50% in the same decade.

1. Effectiveness in relation to costs

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The NEAP is a preventive strategy in which the Department of Social and Family Affairs
refers unemployed people to FÁS on reaching specified unemployment thresholds. It
commenced in September 1998, when all people under 25 who had reached six months on the
Live Register were referred by the Department of Social and Family Affairs for interview by
FÁS. With successive Employment Action Plans, this process has been extended to include
additional age groups crossing specific thresholds of unemployment and from March 2003 all
people aged 25 to 54 are being engaged as they cross the 6-month threshold.
An independent review of the National Employment Action Plan (NEAP) referral process was
commissioned in 2005. The objective of the Review was to estimate the impact of the NEAP
preventive process, to assess the impact on the numbers on the Live Register over the period
1998-2003 and to assess net social welfare savings.
The review indicated that the NEAP was a success overall. The NEAP process has
encouraged early exiting from the Live Register and appears to have reduced the likelihood of
long-term unemployment. An econometric analysis undertaken by the review suggested an
improvement in exit probabilities of between 10% and 20%. It has also proven cost effective
with likely savings on unemployment payments of up to 5% of total expenditure. In
conjunction with the other labour initiatives and wider trends, NEAP appears to have helped
reduce Ireland’s estimated structural rate of unemployment and keep unemployment and
long-term unemployment low, even during a period of weaker labour demand.

2. Outsourcing and Partnerships

FÁS use outsourced measures and partnerships with community and Local Employment
Service (LES)as a means to combat long-term unemployment. Examples of these are as
follows:
High Support Process
The High Support Process is a flexible multi-agency process designed to assist Employment
Service Officers/Mediators to implement a range of responses to meet the needs of clients
who, because of age, health, literacy etc. are experiencing major barriers in progressing from
unemployment to the workforce.
The Pathways Programme
The Pathways Programme is an Employment Services intervention for NEAP clients,
delivered in conjunction with Training Services. The aim of the programme, which is
delivered on a group basis, is to identify the most appropriate development pathway for each
participant to obtain and maintain employment.
Customised Training Fund
The operation of the Employment Action Plan highlighted the need for a certain amount of
flexibility in responding to the identified training needs of jobseekers. In order to meet this
need, a special Customised Training Fund was introduced. Some of benefits of using the
customised training fund is that the client can undertake relevant training at a time and
location that suits them best.
Community Employment Programme
Community Employment provides eligible unemployed people and other disadvantaged
persons with an opportunity to engage in useful work within their communities on a
temporary basis. It helps long-term unemployed people to re-enter the active workforce by
breaking their experience of unemployment through a return to a work routine and to assist
them to enhance/develop both their technical and personal skills.
Local Employment Service
In the mid 1990’s, a Government Task Force concluded that a more locally-based and
intensive guidance service was required to meet the needs of the long-term unemployed and
other target groups in deprived communities who were experiencing barriers in progressing
from unemployment to the labour market. As a result of this finding, the Local Employment
Services (LES) was established in 1995 to operate parallel to the existing FÁS Employment
Services.

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The LES Network assists those most disadvantaged from the labour market to obtain
employment through the provision of intensive support and locally responsive services.
Disadvantaged groups, to whom the LES may offer services, include people who are long-
term unemployed or who are in danger of becoming long-term unemployed, people with
disabilities, Lone Parents, ex-Prisoners, Travellers, etc. These services include intensive
guidance, education/training, employment supports and mediation.

In addition to the target groups mentioned above, the LES receive referrals from FÁS
Employment Services of clients who are in need of an intensive guidance service.

7 Conference results

Although there is a lack of more empirical evidence about the effectiveness of approaches
when PES deals with LTU, several good practices and experiences were reported on the
topics for the seminar,. The main observations from the seminar's presentations in the plenary
and from the discussions in each break-out session can be summarised as follows:

Are there effective methods to prevent Long Term Unemployment ?

The importance of early identification and active individualised contacts were agreed upon
as a general principle, and several good practices were presented and discussed. There is an
evident need for PES to estimate the needs of the clients, and this is the case for both client
groups; the unemployed as well as the employers. Concerning the unemployed, different
examples and approaches from PES on how often in what way and at what moment the
individual contacts should take place were presented, and one of the key questions is the
importance of regular personal meetings as in the UK. Their experience is that practising the
same frequent personalised contact pattern for all unemployed clients without profiling and
segmentation produces very high off flows from the unemployment register in the first six
months after people lose jobs. This releases extra resources to be dedicated to even more
intensive contacts with the minority of clients who do become long term unemployed. The
UK has also found that face to face contact has distinct advantages over other methods of
contact for instance telephone contacts. The Finish experience is that an individual pattern for
these contacts gives good results. At the same time as many PES have developed a multi-
channelling approach for their delivery of services, some PES also stress the personalised
contact plan, like in the case of the new approach from France, when focussing on the
prevention of LTU.
Concerning the role of the PES and employers relations in order to prevent LTU, it was
stressed that PES must become an attractive partner for employers by continuously improving
services and processes. PES must be at least as good as the best private competitors and a
question that could be raised is; 'why should the employers have good relations with PES?'

It would be interesting to carry out a focused study of successful PES approaches to

employers preventing LTU. What are the main elements? What conditions are necessary to
achieve good results?

Does the organisation of PES affect the success of dealing with LTU?
It was agreed that the good cooperation between PES and the social benefit organisation is
crucial and that a holistic approach gives good results preventing and dealing with
unemployment. However, whether a merge between the players is the most effective way of
organising the combat against LTU or if this could be achieved through a close cooperation is
an open question. When comparing models of organisation, the different national contexts
have to be taken into account, and these are not always obvious. It is not evident that
countries that have merged organisations always carried through deeper research before
introducing the new system, but several good examples on the benefits from one-stop-shops

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were presented and discussed during the seminar. The UK experience is that organisational
culture issues are very important to the success of merged PES and social benefit
organisations; in the UK this has involved delivery of programmes to raise awareness of staff
in the new combined agency’s aims and corporate vision. Irrespective of whether PES and
social benefit agencies are merged, or remain separate, it is important that strategic objectives
are consistent and seek to remove tensions between the success criteria for the operation of
employment and social benefit organisations. The UK thematic linkages between PES
management targets, and wider Ministry social policy, quality of life, targets, with funding
from the Treasury based on achievement of these was discussed. This provided an
organisational focus, and rationale for PES activity. Finland has preliminary evidence that
their new organisation has improved the results, but cooperation still needs to be enhanced
with partner organisations. However, the Slovakian and the German experience does not yet
show these obvious results after changing their organisations
The network strategy is a new, important phenomenon when cooperating with other
organisations that has its challenges. This is the case for management, for instance, which
request new skills cooperating with organisations with different culture, mission, databases
etc.
Another important aspect for discussion was the importance of qualifications, motivation
and size of staff. The opinion was also raised that the delivery of tailor-made services are
facilitated in a merged organisation and may enable delivery of a more cost –efficient service.

Are PES up to the job?

If the choice is made to work in partnership with non-profit or private providers, it was
agreed at the seminar that PES have to be able to influence and orient the services of partners
as PES knows the labour market, the situation of the employers and the unemployed. Several
examples of cooperation with private and non-profit players were discussed during the
seminar, and while there is no conclusive evidence on success in results in the different
models presented, the discussions concentrated on the fact that the strategies should remain
within PES, which also should offer a minimum of services to all unemployed. This holistic
approach with PES at the centre carrying through the diagnosis of needs for the jobseeker and
with a PES responsibility to have a good overview of the pathway of jobseekers was agreed
on while reinsertion and specific treatment could involve a series of players on the labour
market. PES would have the overall responsibility in any case and would master the
coordination task and the controlling and monitoring function. The question should be raised
what kind of services to unemployed and employers should be kept within PES, which is the
task of PES and what does PES need to be good at. Can we agree on a core issue for PES?

It would be interesting to achieve a more precise focus on how to make partnerships work,
what does good contracting look like and to highlight more specifically successful
cooperation with the private sector. Which are the important elements? What is the content of
intelligent sub-contracting? It seems that successful contracts will, at least during a period
when markets are growing, need to serve the agenda of both motivating providers, by
including an element of payment for stock, whilst trying to ensure that “cherry picking” can
be avoided through optimising the proportion of payment based on results.

Other issues that were discussed in a more general perspective at the seminar tended to focus
on a move towards the building of competencies and capability rather than to focus on
incapacity and consequently on the stress of job-search and motivating unemployed people to
actively job search instead of emphasising a condition of unemployment.

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8 Follow-up

The evaluation of the seminar shows a high level of satisfaction from the participants, and
confirms that it was a good opportunity to transfer information, experiences and good results.
The seminar participants also highly appreciated that the event was organised at an EU level
rather than on a national level, which underlines the recognition of a common problem and
the importance of knowledge sharing.

The findings from the seminar and from the questionnaire to European PES during autumn
2005 on PES approaches to LTU, will be discussed at the Heads of PES meeting in Vienna in
June 2006. The establishment of the working group and the focus on PES approaches was in
response to requests from the Heads of PES last year to concentrate upon this subject. A
discussion on the proposed group ranged from a desire to focus on policies and to engage in
the exploration of practical measures and exchange of best practice.

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