Creaming-Skimming, Parking and Other Intended and Unintended Effects of Performance-Based Contracting in Social Welfare Services

Abstract

The authors' analysis finds that government-contracted private providers of job placement services in the Netherlands tend to focus on helping clients who are the easiest to place, a practice known as cream-skimming, when the providers are engaged through fully performance-contingent contracts. In addition, making contract payments fully contingent on performance appears to increase job placements, but not job duration, for more readily employable workers.