German Labour Market Policy Reforms

In response to exploding cost of unemployment and continuing public pressure to solve the unemployment problem, the German Federal Government has started in the recent years the largest labour market policy reform in the history of the Federal Republic. This paper analyses a comprehensive set of labour market reforms which was implemented by so called Hartz - Commission in the years 2003–2005. It provides a detailed description of the organizational changes in the Public Employment Service and new instruments of German labour market policy. It also gives a first assessment of the effectiveness of presented elements of reforms.