In May 2019, the Swedish Government commissioned the Swedish public employment service (PES), Arbetsförmedlingen, to prepare for a major reform of publicly funded employment services through the creation of a new labour market authority. The centrepiece of the reform is to redefine the mission of Arbetsförmedlingen from the major provider of employment services towards contracting out the majority of such services to independent providers.
In addition to Sweden’s long-standing experience with contracting out employment services on a smaller scale, a larger trial supported through European Social Fund funding, called rusta och matcha, began in March 2020. This project provides an opportunity for further evaluating contracted out employment services and will provide lessons for the planned reform. Creating a market where employment services are largely contracted-out requires carefully considering many factors such as achieving a fair competition among contracted providers, ensuring the provision services at the local level, and creating a suitable outcome-based compensation model.
In order to learn from other OECD countries’ experiences with contracted-out employment services, Sweden requested technical support to the European Commission through the Technical Support Instrument. The OECD and the European Commission’s Directorate-General for Structural Reform Support (DG Reform) are providing support to Arbetsförmedlingen for the duration of the project, from July 2021 until March 2023 (under framework delegation agreement REFORM/IM2021/009). Within the OECD, the project is being conducted by two directorates: the Directorate for Employment, Labour and Social Affairs (ELS) and the Centre for Entrepreneurship, SMEs, Regions and Cities (CFE). The broader objective of this project is to enhance the capacity of the Swedish authorities to design and implement an effective system of contracted-out employment services, ultimately resulting in improved labour market outcomes for the unemployed.
