The quiet transformation of an ugly duckling: The German Federal Employment Agency’s gradual transition — From a bottomless pit for taxpayers’ money to an efficient service provider

Abstract

Two numbers that are only indirectly related — five million and eleven billion — mark the biggest reform process a German public authority has ever had to undergo. Five million — this was the almost magicalsounding number of unemployed that was exceeded in early 2005. Although this development did not really surprise any of the experts, it stood for the failure of the Schroder government. And in the eyes of the public, it also stood for the failure of the Federal Employment Agency (Bundesagentur fur Arbeit, or BA) to help more people find work. Eleven billion — this was the size of the surplus (in euros) announced by the BA at the end of 2006. This figure proved that it was possible to reform the notoriously cumbersome “mammoth authority” and enable it to succeed.