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Nonprofit Organizations, Employment Programmes and Workfare: Experiences from the US and Germany

Organismes à but non lucratif, programmes d’emploi et workfare : les expériences américaines et allemandes
Volker Eick et Britta Grell


Le débat actuel autour des réformes du marché du travail en Allemagne est largement dominé par des questions d’ordre fiscal, technique et légal. Jusqu’à récemment, pratiquement personne ne semblait plus se soucier ni du genre d’emplois, ni du contenu des programmes de formation et d’aides disponibles au lendemain de la mise en vigueur des lois Hartz, ni, d’ailleurs, de savoir qui s’en chargerait, en particulier en ce qui concerne les groupes les moins susceptibles d’être employés, tels que les jeunes ayant quitté le lycée en cours de scolarité, les travailleurs âgés ou peu qualifiés. Cet article offre une approche comparative des organismes à but non lucratif et des programmes d’emploi aux Etats-Unis et en Allemagne.

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20th century / XXe siècle
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  • 1 Due to the military draft in Germany for young men, today almost 64,000 conscientious objectors are (...)

1The current debate about labor market reforms in Germany is very much dominated by fiscal, technical and legal questions. Until recently, hardly anyone seemed to care any l onger about the kind of jobs, training or support schemes that will be available (and about the question who will provide them) after the enactment of the “Hartz laws”, especially for the groups of the least-employable such as young high school dropouts, older or low-skilled workers. After three years of severe cuts in national public employment and vocational programs, the German Federal Ministry of the Economy and the National Employment Agency unexpectedly announced in Summer 2004, that they would take action to raise the numbers employed in municipal workfare measures from the present 390,000 to 730,000. Only a small proportion of these “new jobs” are supposed to be complemented by some sort of skills enhancement (Der Spiegel, 19/06/2004). At least the established charity organizations, which might face a shortage of cheap labor with the upcoming abolition of civilian community service1, have so far embraced the push towards more workfare. In the meanwhile, not only the main religious associations but also the organizations closely connected to the labor movement have declared their intention to create tens of thousands of temporary “one-Euro-jobs” in their social facilities, “on behalf of the long-term unemployed and youngsters, who might not be offered any other opportunity to enter the world of work” (Arbeiterwohlfahrt Bundesverband e.V. 2004).

2The old controversy about the whole point of public employment schemes that has accompanied active labor market policies in Germany since their introduction at the end of the 1960s is apparently back on the political agenda. Are they providing a “bridge” into the regular labor market? Are they meant to stabilize and support those groups of the population most in need, or are they more likely a handy instrument for bankrupt municipalities to save money and staff? And how do we define “work for the common good” or “community service” in the context of social policies that are increasingly based on sanctions and punitive measures to discipline not only welfare recipients, but the working class in general (Dahme et al. 2003)?

3Professional associations and trade unions are particularly worried about the process of further “wage dumping” and “massive replacement effects” of large workfare programs, pointing to the fiscal crisis of most cities and the dire economic conditions, not only in the former East Germany (Frankfurter Allgemeine Zeitung, 01/08/2004). Representatives of several welfare organizations are opposed to the whole idea of forcing more people into workfare-schemes without any proper legal protection and pay (Süddeutsche Zeitung, 21/08/2004). Even the Green Party is distancing itself from the plans of its larger coalition partner, by calling for “programs with regular wages and training components”, that could provide for the “long-term inclusion of unemployed into the labor market”, instead of offering “mere employment therapy” (Bündnis 90/Die Grünen 2004). Surprisingly, not much attention has so far been paid in the discussion about the future character of work-oriented policies to the approaches and perspectives of the same actors, who have in many places – on both sides of the Atlantic – become the major pillar of local employment programs: so called nonprofit or third sector organizations.

Nonprofit Organizations and Employment Programs

  • 2 According to the most commonly used “structural-operational” definition by the Johns Hopkins Projec (...)
  • 3 About 1 million people (3.7% of the whole workforce) were employed full time by nonprofit organizat (...)

4The size and variety of organizations that are classified by social scientists as belonging to the nonprofit sector2 is constantly growing, not only in Germany and the US, but worldwide (Salamon 2001). With regard to the number of people employed and resources, education, health care and social services have emerged as their most important areas of activity (Betzelt/Bauer 2000; Salamon 2002). According to recent studies, not only has the role of the nonprofit sector in Western Europe as a regular employer expanded since the 1990s3, but more and more charities and community-based associations have taken up the responsibility of providing the most marginalized groups on the labor market (the elderly, high school dropouts, single mothers, low-skilled migrants, people with drug problems, etc.) with new forms of temporary employment, vocational training and income. Some of them have concentrated on new job opportunities connected with environmental issues (ecological building, new sources of energy, etc.), others are trying to respond with their employment programs to the particular needs of deprived neighborhoods and ethnic communities, while others, in the field of social work, have started new local enterprises which offer jobs, income and training to unemployed youth.

5In Germany, most of these projects are financed and supported by a variety of government grants and instruments such as special programs of the Federal Ministries of Education, Family Policies, Economy and Urban Development (Work for the Long-term Unemployed, The Socially Integrated City, JUMP/JUSOPRO, etc.), of the National Employment Agency (active labor market policies based on the unemployment insurance system), local welfare offices, as well as of the European Union (ESF, EQUAL, LEADER, URBAN, etc.), which have become a even more significant source of income for nonprofits in recent years. But also in the US, where market-based resource acquisition and practices (fees, service contracts, asset building, etc.) and funding/donations by private foundations, corporations and universities is much more prevalent (Young/Salamon 2002), more than 50% of the money spent on employment and training schemes by nonprofit organizations derives from federal and state programs. The main sources are the welfare program Temporary Aid for Needy Families (TANF), programs of the US Department of Labor for groups such as youth and low-skilled workers (according to the Workforce Investment Act and other laws), and community (economic) development programs (Empowerment Zones etc.) targeting low-income urban areas.

Berlin: Close Co-operation with the (local) Administration

  • 4 The official unemployment rate in Berlin has not fallen below 18% for years. According to the Natio (...)
  • 5 The 2003 newly created SGB III (Sozialgesetzbuch) sets the rules for entitlements and instruments f (...)

6The context for the employment activities of nonprofit-organizations in Berlin is influenced by an extreme and long-standing lack of available training positions and job vacancies and below average economic growth rates, compared to the rest of Germany4. During the time of our investigation (2000-2003) about 1,000 nonprofit organizations were involved in public training and job schemes (financed through instruments of the SGB III and BSHG5), serving and employing between 21,000 and 25,000 former beneficiaries of unemployment or social assistance each year (Senatsverwaltung für Arbeit 1999; ARGE Servicegesellschaft 2004). Two-thirds of these organizations, working in a variety of areas such as sports, recreation, culture, women’s issues, migrant and refugee rights, etc., used these public programs mostly for there own concerns and purposes. Since they cannot afford to pay full-time staff out of their own pockets they take the government grants to finance temporary workers who in addition to voluntary activists help to maintain their organizational structures. Without public employment schemes, most of the social, cultural and political associations (and their respective services and activities) in Berlin would no longer be able to survive.

7On the other hand, about 100 nonprofits are characterized by the city and state government (Berlin Senate) as “pure” or “labor market-oriented” employment entities, supported by additional government subsidies. These organizations have developed a special focus on reintegrating transfer recipients into society and employment by offering either community service-type jobs in the so-called “second labor market” or by preparing them for regular jobs by training and various social services. A majority of these “labor market-oriented” nonprofits grew out of new social urban movements, which often, like the squatter movement in the Western part of the city in the 1980s, had emerged in strong opposition to the housing and social policies of the local government and administration. However, in the course of the years and with a process of growing professionalism, most of them gave up their role as advocacy groups for the rights of low-income and disadvantaged groups, but became “partners” of public institutions; a (neo)corporate kind of relationship between the local state and part of the nonprofit sector evolved (Reisch 2001). Despite all the differences in the history of the Eastern part of the city, the story of nonprofits in the former capital of the GDR since unification is quite similar. The massive elimination of jobs in East Berlin – 280,000 workers were laid off between 1990 and 1995 in the manufacturing sector alone – was in the first years accompanied by various local government efforts and financial investments, establishing new state employment programs, institutions and partnerships. A number of the former employees of the industrial Kombinate (industrial complexes) in East Berlin, which had been wound up within only a few months after unification, were temporarily employed by so-called rescue companies and supported by newly created service companies, paid by the local government. While most of the “labor market-oriented” nonprofits in the East developed out of these rescue companies, many of the Western organizations quickly moved into the Eastern parts of the city to profit from new public funding streams.

Los Angeles: A Broader Variety of Nonprofit Organizations

  • 6 The official unemployment rate in Los Angeles in 2004 was 6.1 %. While the number of welfare recipi (...)

8In the official partner city of Berlin, Los Angeles, where growing socio-spatial disparities, segregation and poverty wages for low-skilled workers present the main challenges for local employment policies6, the number of nonprofit organizations involved in training and workfare-schemes has considerably risen since the enactment of the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) 1996 and the Workforce Investment Act (WIA) 1998. Since the end of the 1990s almost all of the important means-tested income-support programs (Temporary Aid for Needy Families/TANF, General Relief for needy persons without minor children, Food Stamps, etc.) in the US have had strict time limits (a maximum of five years) and strong work obligations. As a result of this work-first policy, even homeless people, single mothers with babies and persons with major health and drug problems in Los Angeles are forced to participate in work-related activities in order to receive meager social benefits (Zellman et al. 1999; Horton/Shaw 2002). Furthermore, the WIA, comparable with the German “Hartz laws”, introduced the creation of so-called One Stop Centers for all people seeking for work and training (O’Shea/King 2001), which especially in urban areas with a high percentage of disadvantaged inhabitants are managed by nonprofit organizations.

9With regard to its higher population and the more troubling poverty trends, the engagement of nonprofits in employment policies and programs seems to be less relevant in Los Angeles than in Berlin. Apart from the 100 organizations that could be identified as having their main focus on job training and placement, we estimate that about 400 community-based and local nonprofit organizations are at least temporarily involved in public workfare and reintegration schemes via contracts with the federal and local government. At first glance, these organizations have hardly anything in common with their counterparts in Berlin. Their history, structure and political roots are very different. About 40 percent of all nonprofits active in welfare-to-work programs in Los Angeles target specific ethnic communities. A large number of them are faith-based or have at least a religious background, for example Goodwill Industries, the Jewish Vocational Service, Catholic Charities or the Salvation Army which in the meanwhile have become major players in the local workfare business.

10Another important group in Los Angeles, trying to develop its own employment and training opportunities for the disadvantaged and minority groups, had its roots in social and political events of the 1960s and 1970s, such as the civil rights and welfare rights movements (Piven/Cloward 1977) fighting for economic justice and equal treatment of Afro-Americans. Moreover, the riots in Watts (1965) and South Central (1992) as well as the following “antipoverty programs” by the government all fostered in Los Angeles the founding of a multitude of organizations, that are all committed to the approach of community building (Pastor et al. 2000). These organizations, usually labeled community development corporations (CDCs), are in the meanwhile providing a broad spectrum of basic social services in poor and deprived areas such as South Central and East Los Angeles: from child care and education facilities, health clinics and One Stop Centers to nonprofit housing corporations, community businesses or bus services, in support of the local and often immobile population. When additional public funding became available in the course of PRWORA and WIA for employment and training programs, more and more CDCs decided to take advantage of this money and use it for their own neighborhoods.

Nonprofit Organizations between Social Integration and Workfare

11Despite different social and political roots and divergent socio-economic and legal frameworks, “labor market-oriented” nonprofit organizations in both countries, Germany and the US, are driven by similar problems and tensions. First of all, they are restricted and hindered by often conflicting goals and interests of federal and local government programs and policies. Secondly, their own standards with regard to social work and their role as advocates for the poor might sometimes not be compatible with the demands of the market, where they have to compete with other private and state actors for funding and resources in order to keep their organization going and to protect their own jobs. From the perspective of the administration and government, experimenting with different forms of “local partnerships” as part of new public management strategies, the strength and advantage of the nonprofit sector is based on its flexibility and its specific capacities to provide small-size solutions and need-based services for particular segments of society. One could add what some authors call the “social capital” of voluntary and nonprofit-entities: they are considered to be in a better position than state institutions and for-profit companies to create trust and activate and use various social networks and particular local knowledge.

12But through the transformation of social policies and their goals, these specific capacities and advantages of nonprofit organizations are threatened and more and more dominated by the government in order to impose its punitive “activating strategies”. Following the legal and ideological shifts in social and employment policies at the end of the 1990s, one can observe in both cities, Berlin and Los Angeles, a growing one-sided orientation of local job and training programs. They are supposed to be a substitute for entitlements and costly income-support schemes and are aimed at putting the unemployed as quickly as possible into low paying jobs in more and more flexibilized and deregulated labor markets: a strategy that in parts of the critical specialist literature has been termed a neoliberal workfare policy (Lødemel/Trickey 2000; Peck 2001; Quaid 2002). Some nonprofits have thereby discovered new areas of activities and responsibilities – for example case management for welfare recipients or direct job placement –, others with a broader understanding of employment policies and social inclusion have come under severe pressure from government agencies and are forced to look for new market-based practices and resources.

Job Placement

13In recent years, job placement – the direct deployment of less-competitive unemployed – has become a new field of activity for nonprofits. More than in any other field, nonprofits have to compete with for-profits for financial subsidies, and in some cases even for “clients”. Some organizations have responded to this new market by establishing specialized job placement companies, by founding their own temp agencies, or organizing the supply of temporary workers.

14The regular or so-called first labor market has become more important for nonprofits. Firstly, since the year 2000, nonprofits in Berlin have been forced to deliver job placement to all of their “clients”. Secondly, on the municipal level an intense cooperation emerged between the twelve welfare offices, the six regional employment offices, and private job placement agencies like the temp agency Maatwerk focusing on welfare recipients and youth aged under 25 – indeed, this kind of cooperation has been more like experimenting on the local level. Progress indeed was pretty poor. Out of 5,000 unemployed and welfare recipients, less than 10% got a job on the regular labor market within a two-year period (1998-2000). With Hartz IV – i.e. the merging of welfare offices and employment offices since 2004 – attempts began to bring a stronger cooperation to the fore aiming to move people into the regular labor market or “activate” them through job opportunities paying 1 Euro per hour in addition to the unemployment benefits.

15Another challenge for nonprofits has been the devaluation of tariffs and, therefore, the undermining of quality-of-work and quality-of-wage standards. Employment and welfare offices as well as the Berlin Senate forced nonprofits to deploy their “clients” into jobs that do not meet family wage standards. While some nonprofits tried to resist this new regulation explicitly, others tried to avoid confrontation by not sticking to the rule, and tricking the administrations; another group of nonprofits just followed the new orders while, finally, there are nonprofits advertising this new workfare approach as one of their main capacities and philosophies (Eick et al. 2004: 144-150; Eick 2005b). One of the companies explicitly stated that it “will inform the employment office about all clients not willing to work”, thus focusing on a stark control function, and goes on to state that to continue its main focus “on the low-wage sector seems to be useful” (IHS gGmbH 2000: 3, 7).

  • 7 Generally, a Business Improvement District is defined as “a territorial subdivision of a city in wh (...)
  • 8 Downtown Los Angeles is “home” to one of the largest homeless populations in the US; it is estimate (...)

16In Los Angeles, due to the more restricted system of welfare grants and higher barriers to participation in the welfare system, nonprofits are more specialized in placing disadvantaged unemployed and welfare recipients in temporary and badly paid jobs and work opportunities. Because of a much more advanced and expanded low wage service sector, so typical of today’s US-metropolitan regions, nonprofits need to be much more professional and aggressive to develop new markets for their “problematic clients” – especially, if they want to be able to compete with the growing for-profit temporary stuffing industry (Peck/Theodore 2002). Some nonprofits have been quite successful within this competition: Chrysalis, for example, established a temp agency called StreetWorks in Downtown Los Angeles which meets the demands at the local level in a highly flexible way. On the one hand, Chrysalis supports the homeless on the streets while providing them with food and work; at the same time it offers specialized services to the City of Los Angeles and the Business Improvement Districts (BIDs) 7 in fields like order-maintenance, cleanliness and safety. Chrysalis takes advantage of its special capacities. Firstly, it runs and coordinates a plethora of charitable institutions including assessment and job training; therefore Chrysalis is able to rely on a motivated and work-ready labor force. Secondly, Chrysalis profits from its local knowledge while offering its street-cleaning services on Skid Row in Downtown LA. As Skid Row is “home” to more than 10,000 homeless people every day (Sambale 2003; Economic Roundtable 2004)8 street cleaning, to begin with is about the removal of the homeless and their belongings. Chrysalis’ work force consists of (former) homeless people and therefore is closer to the homeless living on Skid Row. What was done before in a military style – removing the homeless with violent police squads some years ago (Sambale 2003) – can be achieved less aggressively and more effectively today through StreetWorks. The LA city administration and the BID business community alike embrace the achievement.

17A similar approach of “soft policing” or “verbal judo” as it is called (Eick 2005a, b), emerged in Berlin within the Federal program called Socially Integrative City (cf. Löhr 2003). Former unemployed and homeless people are deployed within identified socio-economically “disadvantaged” areas to identify, control, and police so-called “problematic neighbors”; such programs include the prevention of public drinking of alcohol and securing that dogs are kept on leashes (Eick 2003a: 83-85; Eick 2005b).

Social Integration

18Even though the demands of state administration have changed and labor market integration of “disadvantaged” groups has become more market-oriented in recent years, many nonprofits still connect their job placement programs with social and socio-political aims and tasks. Part of these aims and tasks is psychological support of the unemployed and welfare recipients beyond a pure Work first focus, the creation of collectively organized self-help structures on the local level and local economic development in “disadvantaged” areas. Their local knowledge, their closeness to the clients, their experience, and their innovative skills seem to predestine them to bring the new activating programs to the urban poor. As Mayer (2003b: 8) states:

Nonprofits are given priority here because they are more familiar with the particular local constellations of needs and development potentials, and because they are (presumably) based on solidarity and empowerment rather than on coordination through market or bureaucracy. Thus they appear as best-suited agents for implementing the strategies of local orientation and non-market coordination, and thereby to improve cooperation between state, capital, workforces, and residents in the local Standort. In other words, their characteristics seem to equip them to address the kind of market failure and state failure that are endemic to neoliberalism.

19It is especially these aims, tasks, and proactive orientation of nonprofit organizations which in the current debate are seen as their particular strengths. It is under the conditions of the current labor market reorientation and welfare policies that devaluation and ambivalent instrumentalization of these socially integrative capacities takes place.

20Due to the state-run Work first policy, social aims and integrative approaches of nonprofits are pushed into a defensive position, especially because success in fields such as social integration is less “measurable” or “countable” than direct job placement into the regular labor market or saving money otherwise spent on unemployed and welfare recipients.

21On the other hand, local welfare and employment offices are (still) forced to admit that growing processes of marginalization and poverty frequently come with significant health problems and psychological impairments that have to be addressed and do conflict with the job readiness of the “clients”. It is for this reason that the philosophy and practice of state-subsidized programs in both countries summarize such socially integrative projects and programs as programs heading for maintenance or regeneration of employability and job (training) readiness.

22To “produce” employable unemployed and welfare recipients, nonprofits are provided with but limited financial support and are challenged with state’s failure to activate their ”clients” and make them “fit” for the regular labor market. On the other hand, they are to connect this task with the identification and creation of meaningful social-spatial and socio-pedagogical projects and programs without solely subordinating themselves to the administration’s Work first logic and without paying less attention to their social goals.

23Meanwhile, a wide range of community organizations which used to function as advocates or lobby organizations for refugees and migrants, and have been working for years for charitable purposes being financed through contributions are integrated into the local Welfare-to-work regime.

24In compliance with their own requirements, nonprofits addressed housing issues as well as transportation problems, provision of clothing and medical treatment in making use of state-run or city programs. Of distinct importance in doing so are those nonprofits that are able to tackle the specific needs of ethnic groups or communities. The Pacific Asian Consortium in Employment, for example, offers its social services and employment programs in ten different Asian languages. Other nonprofits like Chicana Service Action Center, El Proyecto del Barrio, or CHARO Community Development Corporation have focused their work on Hispanic residents or migrants. Beside this, lone parents (mainly single mothers) are one of the main target groups within social work and employment related programs. While the (local) administrations are no longer able to deliver enough opportunities for unemployed women to participate in such programs developed by nonprofits – even though Washington put in more money in the beginning – it is the nonprofits that develop “integrative” employment programs including family support structures and child care programs.

25It was not until 2001 that specific welfare groups were selected to take part in workfare programs. Single parents with children aged under three and “clients” with psychological problems or suffering personal crises were not chosen to take part in work (re)integration programs before but now are forced to do so. Compared to other employment programs in Germany, Berlin’s work (re)integration programs have been described as “remoteness from the market” (Schmid/Blancke 2001; Schuldt/Frank 2003).

26Nevertheless, employment programs aiming at the subsidized or “second” labor market deploy about 83,600 welfare recipients and 15,000 unemployed every year into such work schemes (Eick 2003b: 52; cf. Eick et al. 2004: 60). Out of this group a wide range of people needs parallel socio-pedagogic or psychological support while participating in the programs. Therefore, most of Berlin’s nonprofits developed very early approaches and started to train personnel to address those problems; i.e. combining qualification, training and employment programs with support structures like liability assistance or socio-pedagogic help. While this orientation has been supported by and financed through the employment offices and the Berlin Senate since the mid 1990s, the situation has changed, and today a wide range of this kind of work has to be carried out with less money and shrinking personnel. It is under such circumstances that, given the current labor market, nonprofits and the local administrations agree on the fact that, for most of the victims of the economic restructuring process in Berlin, work (re)integration into the regular labor market will be the exception rather than the rule (bag Arbeit 2003: 1).

27While the official systems of education, schooling and labor market alike have less to offer the growing number of young people in Los Angeles and Berlin, youth are one of the main target groups nonprofits are dealing with in both cities. Gang activities and high incarceration rates can be seen as paradigmatic for Los Angeles while in Berlin high unemployment rates of (migrant) youth and a growing rate of school dropouts would seem to anticipate a similar development, especially given the tremendous cutback of social integrative infrastructure like youth centers, crisis intervention centers and family support services.

28What is striking is the pronounced pragmatism of nonprofits as a strategy to meet the needs of young unemployed while trying to stick to their own socio-political requirements. The starting point of many employment programs in Berlin in the early 1980s was, for example, pedagogically advised youth groups sharing apartments as a means of therapy. The same nonprofits invented, created and developed work opportunities, training and employment schemes in fields like ecological housing construction for this kind of social work, or they established their own restaurants providing “clients” and the surrounding community in “disadvantaged” neighborhoods with healthy and cheap food. Even today, the lion’s share of nonprofit-run work (re)integration programs for youth are based on voluntary participation and an intense individual case care orientation.

29Projects and programs that combine job training, qualification, and the teaching of soft skills with social services are also attractive in Los Angeles as several examples show. There are long waiting lists for programs combining gratis job training, assistance in career planning, access to medical treatment and (very popular) tattoo removal.

30Programs that aim not only to provide youth and unemployed with individual case care but to integrate them into voluntary community work or longer lasting initiatives to strengthen the social and economic performance of the neighborhood and community only rarely exist in both cities. Given the limitation of financial and personnel resources nonprofits are regularly forced to reject people looking for assistance and support; sustainable employment perspectives within social enterprises are difficult to develop, especially in “disadvantaged” areas and mainly because of the lack of necessary financial resources (starting capital).

31Berlin’s nonprofit-organizations are – even though socio-spatial programs like the Federal program Socially Integrative City or Neighborhood management do exist (Löhr 2003; Eick 2005b) – confronted with the employment offices’ practice, structure and logic which basically aims at and focuses on target groups or individuals (instead of neighborhoods or communities) and on single projects (instead of sustainable programs), and therefore holds neither specific instruments nor adequate and sufficient financial resources to develop a socially integrative policy (approach). Focusing on the reorganization of the “second” labor market by transforming work (re)integration programs into short-term job opportunities (lacking any qualifying part) this policy of the unemployment offices further weakens the stabilizing and integrative parts of the programs mentioned above if not even leading to the full destruction of most parts of the social infrastructure nonprofits had developed over the last two decades or so.


32Since the 1980s a plethora of differentiated work (re)integration programs has been practiced in both cities under the auspices of nonprofit organizations. Services offered within these programs face strong demands from the community, especially in areas labeled as “disadvantaged” because of their high unemployment rates, number of welfare recipients, and more than often number of residents stemming from ethnic minorities. It has to be seen as one of the merits of such organizations that many of them continued to offer programs and structures for such groups to enable them to cope and sustain their individual and collective everyday life even under conditions of growing exclusion and neoliberal restructuring.

33All the same, it is due to their high financial dependency that the support logic of the local bureaucracies tends to override their social requirements and is assertive in framing their ability to work in these ways.

34While the Work first approach emerged in both cities, some of the above mentioned organizations could take advantage of this restructuring and took over new responsibilities. Currently, it seems unclear how far nonprofits will remain as important players as job placement agencies under the new Hartz laws (Wohlfahrt 2003; Völker 2004); if so this might lead to an even more professionalized and specialized service delivery serving the administrations’ needs.

35Instead, what is less open are trends already identified in Los Angeles’ nonprofit work (re)integration and job placement development. Firstly, the aim to create and develop meaningful, financially suitable and sustainable jobs for unemployed and welfare recipients is declining in the face of the logic of “getting a job at any price”. Secondly, more and more recipients of unemployment or welfare benefits with extensive barriers to work are integrated into the workfare system which automatically leads to new processes of selection and exclusion as those who cannot follow the new paradigm for whatever reason will be sorted out – and lose their benefits. “Investment in human capital”, as programs such as advanced training and more ambitious qualifications are called in official statements, is only offered to those unemployed holding a better than good prognosis for labor market reintegration. Other unemployed and welfare recipients are sorted out and transferred to social and charitable organizations whose task is to “keep people busy”. Thirdly, while nonprofits are forced to deliver their services in a more market-oriented way (aiming at making them more easily measurable in quantitative terms) the new work (re)integration programs tend to lead to a unification and, thus, to an inadequate simplifying of the previously complex programs. At the same time such orientation leads to a “Darwin-style” competition affecting especially small and value-driven organizations. (Even though the opposite might be true for faith-based initiatives that stick to the Bush administration’s approach; in the German case those nonprofits that focus on voluntary work, opportunity structures and the like are under pressure). Fourthly, bringing the Work first policy to the fore goes with higher sanctions and intense cutting of benefits which combined with reduced wages will create more problems of poverty which again have to be addressed by nonprofits and/or (even more) repressive instruments.

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1 Due to the military draft in Germany for young men, today almost 64,000 conscientious objectors are performing civilian community service for a period of nine months, working mainly in hospitals, retirement homes and for the large welfare umbrella organizations (Caritas Federation, Diakonisches Werk/Service Agency of the Protestant Church, Workers’ Welfare Association, Central Welfare Office of the Jews, German Red Cross, Non-denominated Welfare Association). There are plans by the current federal government to give up the draft as well civilian community service.

2 According to the most commonly used “structural-operational” definition by the Johns Hopkins Project, based at Baltimore University, which was designed to develop an “International Classification System of Nonprofit Organizations” that cuts through the divergent tax codes and regulations of different states, all entities that are part of the nonprofit sector share the following features: a) formal organization, b) privately incorporated but serving a public purpose, c) self-governing, d) voluntary to some degree, and e) non-profit distributing (Anheier 1997).

3 About 1 million people (3.7% of the whole workforce) were employed full time by nonprofit organizations, including the six large umbrella associations, in Germany by the end of the 1990s (Priller et al. 1999).

4 The official unemployment rate in Berlin has not fallen below 18% for years. According to the National Employment Agency, there were 5,000 job openings in the city for 300,000 people registered as unemployed in 2004 (Jahr-Weidauer 2004).

5 The 2003 newly created SGB III (Sozialgesetzbuch) sets the rules for entitlements and instruments for integrating the unemployed into the labour market, until 2004 and the full enactment of the “Hartz laws” the “Social Assistance Law” (BSHG) comprised regulations and instruments for workfare schemes for welfare recipients.

6 The official unemployment rate in Los Angeles in 2004 was 6.1 %. While the number of welfare recipients declined by about 50 % between 1995 and 2003, the percentage of the population considered to be poor rose from 13.1 % in 1990 to 22.1 % in 2000 (Drayse et al. 2000).

7 Generally, a Business Improvement District is defined as “a territorial subdivision of a city in which property owners or businesses are subject to additional taxes. The revenues generated by these district-specific taxes are reserved to fund services and improvements within the district and to pay for the administrative costs of BID operations. BIDs’ services are provided in addition to those offered by city governments. Most BIDs focus on traditional activities, such as garbage collection, street maintenance, and security patrols”. See Richard Briffault, “A government for our time? Business Improvement Districts and urban governance”, Columbia Law Review, Vol. 99, 368.

8 Downtown Los Angeles is “home” to one of the largest homeless populations in the US; it is estimated that 78,600 people were homeless at some time in 2002 whereas the estimated annual homeless population is estimated at 253,900 in LA County. 65 % of them are located in the Supervisorial Districts South Los Angeles/Inglewood and Downtown Los Angeles/W. San Gabriel Valley. See Economic Roundtable (ed.), Homeless in LA (Final Research Report, September), Los Angeles: ms., 14, 74.

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Volker Eick et Britta Grell, « Nonprofit Organizations, Employment Programmes and Workfare: Experiences from the US and Germany »Revue LISA/LISA e-journal [En ligne], Média, culture, histoire, mis en ligne le 01 janvier 2008, consulté le 24 juillet 2024. URL : ; DOI :

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Volker Eick

(Berlin, Germany)
Volker Eick & Britta Grell are German political scientists at the Freie Universität Berlin, John F. Kennedy Institute, Department of Politics, Germany. They have written many articles and studies on the notions of Welfare more particularly in Germany and the United States. They have collaborated on the DFG Research Project: “From Welfare to Work: A German-American Comparison of Local Social and Employment Policies considering in particular the Third Sector in Berlin and Los Angeles”, with Margit Mayer & Jens Sambale (2000-2003). Volker Eick is currently finishing his PhD on “Neue Sicherheitskonzepte im sich wandelnden Wohlfahrtsstaat. Kommunale Kriminalpolitik zwischen Kommerzialisierung und Community” (New security concepts within the changing welfare state. Communal crime policy between commercialization and community). Most recent publications: “Neoliberalism and Urban Space: Activism, Atavism, and Aspiration”, in Estonian Architectural Review Ehituskunst, forthcoming Kontrollierte Urbanität. Zur Neoliberalisierung städtischer Sicherheitspolitik (Ed., with J. Sambale/Eric Töpfer), Bielefeld (2007); “Preventive Urban Discipline: Rent-a-cops and the Neoliberal Glocalization in Germany”, in Social Justice, 33/3 (2006). For more details, see

Britta Grell

(Berlin, Germany)
Volker Eick & Britta Grell are German political scientists at the Freie Universität Berlin, John F. Kennedy Institute, Department of Politics, Germany. They have written many articles and studies on the notions of Welfare more particularly in Germany and the United States. They have collaborated on the DFG Research Project: “From Welfare to Work: A German-American Comparison of Local Social and Employment Policies considering in particular the Third Sector in Berlin and Los Angeles”, with Margit Mayer & Jens Sambale (2000-2003). Britta Gell is also finishing her PhD. Selected articles: Britta Grell, Jens Sambale, Volker Eick 2002: “Workfare zwischen Arbeitsmarkt- und Lebensstilregulierung. Beschäftigungsorientierte Sozialpolitik im deutsch-amerikanischen Vergleich“; Britta Grell / Jens Sambale 2001: “Lokale Ansätze zur Beschäftigungsförderung. Erfahrungen aus einem deutsch-amerikanischen Ländervergleich“. For more details, see

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