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Förderung von Agenturen für haushaltsnahe Dienstleistungen schafft Arbeitsplätze für Geringqualifizierte. DIW Berlin: Vorschlag aus Rheinland-Pfalz kann eine halbe Million Arbeitsplätze bringen

Press Release of June 5, 2002

Private households are very sensitive to changes in the price of services. This has been proven by analysis based on data collected by the DIW Berlin's Socio-Economic Panel. In its current weekly report 23/2002, the DIW Berlin shows that promoting agencies for household tasks could create employment and make an long-term contribution to the legalisation of illicit work. A legislative initiative recently presented in Rhineland-Palatinate suggests that developing a legal market for household tasks by providing wage cost subsidies and through founding domestic service agencies would create half a million jobs for low qualified workers. If the jobs created were filled by the unemployed, then the net burden on the state and its social security system would only amount to 3.4 billion EURO. Eastern German households, however, do not have large enough demand for domestic services to have a noticeable effect on the reduction of unemployment in eastern Germany
One of the German labour market's main problems is the particularly high unemployment rate for low qualified workers. According to recent estimates, more than 23% of the unemployed in western Germany and 54% in eastern Germany are low qualified workers. According to calculations by the Institute for the Study of Labor (IZA) and the DIW Berlin, around two million unemployed and income support recipients capable of working can be assigned to the low paid sector, whilst simple domestic tasks in German private households, like cleaning, gardening and minor repairs, are overwhelmingly performed by illicit workers.

Private households can contract domestic service agencies to provide them with the necessary labour for a certain number of hours a week. The agency is liable for the trustworthiness of its employees, ensures the continuity of labour supply and co-ordinates the work schedules of its employees. Employees receive enough work to provide them with a sufficient level of income and make social security contributions through the agency. Such agencies, however, are not employment agencies but normal service companies similar to the nursing care agencies that provide 24 hour care in the home for sick and elderly persons with private nursing insurance policies.