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This is a brief literature review of Public Employment Agencies (PEAs) in various countries with the aim of identifying the main aspects of PEAs explored in the research and to see if there are potential areas for future research in academia.
Key search words/phrases: public employment agencies, employment service centres, effectiveness, efficiency.
A public employment agency (PEA) is a government entity that is usually responsible for assisting citizens in finding jobs, providing career guidance, and disbursing unemployment benefits (Fougere, Pradel, and Roger, 2009). However, depending on the nature and development of the labor market in each country, its functions may include one or more of the above (Thuy, Hansen, Price, and Perret-Nguyên, 2001). There are also private employment agencies, which provide similar functions, usually more “intensive and expensive services”, but target different types of job seekers, usually those who can afford the cost of job search (Fay, 1997; Rehwald, Rosholm, and Svarer, 2017).
There are different terms for public employment agencies around the world: “job brokerage agencies” in Europe (Launov & Wälde, 2016), public employment services in various ILO member states (Thuy et al., 2001), employment service offices in Australia (Fay, 1997), public employment services in Sweden (Höglund, Holmgren Caicedo & Mårtensson, 2018), job centres in South Korea (Höglund, Holmgren Caicedo & Mårtensson, 2018), and employment agencies in the United States (Höglund, Holmgren Caicedo & Mårtensson, 2018).(1) and Jobcentre plus in the UK (Lindsay, McQuaid, and Dutton, 2008, p. 722), and the Employment Service Centre (ESC) in Nepal.(2) temporary work agency, etc.
People working in PEAs are also known by different names, including employment brokers in Europe (Commission, 2016), employment counselors in Nepal(3)career agents, placement officers, employment outreach workers and employment specialists in Taiwan, employment counselors in France (Sultana & Watts, 2006), employment coaches in the UK (Lindsay et al., 2008, p. 726) and case managers in Australia (Fay, 1997), among others.
The clients of PEA are job seekers, training providers and employment {Commission, 2016, p.25}.
The history of the Public Employment Service (PES) dates back to the late 19th centuryday In the 19th century, PES were primarily established to address the socio-economic challenges of unemployment, but it was the International Labour Organization (founded in 1919) that formally established PES in different developing countries. During World War II, PES were involved in job brokering or labor exchange and the distribution of unemployment benefits. However, after the 1970s, due to high unemployment growth, PES became government entities in developing countries responsible for formulating employment policies and labor market programs. Around the 1990s, private employment agencies emerged due to the increasing impact of economic liberalization and globalization (Thuy et al., 2001).
Basically, PEA is considered to perform two main functions: first, to provide job search assistance and career guidance in developing countries, especially to unemployed youth; second, to provide unemployment benefits to short-term and long-term job seekers based on the “work test function”(4) and the management of an aging workforce in developed countries ( Rehwald et al., 2017 ; Sultana & Watts, 2006 ; Thuy et al., 2001 ).
Research in various countries has focused on the standard functional aspects of PEA. These functions include 1) service personalization, that is, providing personalized support to customers in job search, counseling and other services 2) assessment of personal attributes and preferences 3) short-term job placement and long-term career strategy 4) development of personalized action plans (Sultana & Watts, 2006). In addition to job testing and job search assistance functions, some people also advocate that PEA should also play a policy-making role (Thuy et al., 2001).
Various aspects of PEA have been explored in the research; ways to improve the effectiveness and efficiency of PEA through various models of job search and job matching (Fay, 1997; Fougere et al., 2009; Van Ours, 1994), the need for labor market reform activities, including unemployment compensation systems, vocational education and training regulations, unions, labor taxes, subsidies and employment protection (Sultana & Watts, 2006; Thuy et al., 2001). Some have explored what kind of relationship should exist between PEA and other organizations (including government and non-governmental organizations, private institutions and community organizations)? (Thuy et al., 2001). A few have also raised the question of how to achieve the efficiency and equity goals of PEA that take into account disadvantaged groups? (Fay, 1997; Fougere et al., 2009; Thuy et al., 2001)
Most of the research contexts are limited to formal labour markets where statistics on labour market information are available (e.g., escape from unemployment), especially in European and American countries that provide unemployment benefits and active labour market programmes such as vocational training in domestic markets. However, public employment agencies have received relatively little attention as they struggle in highly informal and poor economies with significant geographical and socio-economic barriers to reaching job seekers and employers (education, skills, awareness, public services, social marginalization, etc.).
When studying the effectiveness and efficiency of PEAs, the main studies have adopted statistical methods (IPA techniques, partial equilibrium unemployment, simplified models of job search, structural models of job search and its inhibitory effects, etc.) to analyze the functional aspects of PEAs, such as job search, job placement and its impact on escaping unemployment, which are usually considered as indicators of the effectiveness of PEA operations. This shows that there is a lack of qualitative research methods to study the effectiveness of PEAs in achieving equity goals, such as integrating disadvantaged youth into the labor market. Some studies even consider evaluating the role of mutual partnerships between employment agencies (public and private), vocational education and training institutions, government and non-governmental organizations, and community partners in strengthening the position of PEAs. (Thuy et al., 2001; Van Ours, 1994).
Commission, E. (2016). Career Brokers Project – Knowledge outputs on competence and learning development for career brokers in the EU
See (page 40). Europe: Job Broker.
Fay, RG (1997). Improving the effectiveness of public employment services by introducing market signals.
Fougere, D., Pradel, J., & Roger, M. (2009). Do public employment services affect job search efforts and outcomes? European Economic Review, 53(7), 846-869.
Höglund, L., Holmgren Caicedo, M., & Mårtensson, M. (2018). Balancing strategic management and entrepreneurial practice: The journey of innovation in the Swedish public employment service. Financial responsibility and management.
Launov, A., & Wälde, K. (2016). The employment effects of reforming public employment agencies. European Economic Review, 84140-164.
Lindsay, C., McQuaid, RW, & Dutton, M. (2008). New approaches to inter-organizational collaboration and employability. Social Policy and Administration, 42(7), 715-732.
Rehwald, K., Rosholm, M. and Svarer, M. (2017). Do public or private employment service providers have an impact on employment? Evidence from a randomized experiment. Labor Economics, 45169-187.
Sultana, RG, & Watts, AG (2006). Career guidance in public employment services in Europe. International Journal of Education and Career Guidance, 6(1), 29-46.
Thuy, P., Hansen, E., Price, D., & Perret-Nguyen, H. (2001). Public employment services in a changing labor market: International Labour Office, Geneva.
Van Ours, JC (1994). Matching unemployed persons with job vacancies in public employment offices. Empirical Economics, 19(1), 37-54.
(1) see more https://www.ilo.org/employment/Whatwedo/Publications/working-papers/WCMS_453913/lang–en/index.htm
(2) see more https://www.ilo.org/kathmandu/whatwedo/projects/WCMS_377004/lang–en/index.htm
(3) see more http://www.dol.gov.np/ckeditor/kcfinder/upload/files/ToR-External%20Collaborator%20Employment%20Counsellor%20final.pdf
(4) PEA officials determine whether clients are eligible for unemployment benefits by testing their work history and job search activities and results.
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