‘Creaming and Parking’ in Marketized Welfare-to-Work Services: Evidence from Germany, the UK, and France

Over the past 20 years European governments have increasingly used market mechanisms to govern the welfare state and public services. The effects of marketization on the character of these services are complex and difficult to study. This paper examines the problem of ‘creaming and parking’ in the context of employment services, in which hard-to-serve clients are neglected (‘parking’), while staff time is used primarily for those who are easy to place (‘creaming’).  Based on more than 300 interviews in the UK, France, and Germany we observe variation in contracted-out service providers. In France there is relatively little competition for contracts and only experiments in payment by results; here, service providers do not systematically cream and park. In Germany and the UK, where contracting is more competitive and results-oriented, creaming and parking practice varies. It is widespread at for-profit providers, but less so at non-profits. We identify two mechanisms through which marketization leads to creaming and parking. First is the rise of commercial providers, with work-first job-placement practices, underpinned by standardized, IT-intensive management control systems. Second is the decline of more holistic social-work approaches within non-profit providers due to severe financial pressures from marketization and cuts. We conclude that these processes unleashed by marketization may be difficult to reverse due to these internal organizational practices within private contractors.