Outsourcing of public services in Europe and segmentation effects: The influence of labour market factors

Damian Grimshaw*, Jill Rubery, Dominique Anxo, Maya Bacache-Beauvallet, László Neumann, Claudia Weinkopf

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

33 Citations (Scopus)


This article examines the influence of labour market factors on public authorities’ decisions to outsource public services in five countries. The dominant focus in the outsourcing literature is on a narrow range of factors: public–private gaps in pay, union membership and collective bargaining coverage. We find such differences to be variable, and develop a more encompassing perspective. This includes consideration of labour market rules that establish wage floors and employment protection (especially for outsourced workers) and the possible differentiation of legal status between public and private employees. Our case studies from local government in five countries highlight a set of country-specific interconnections between labour market factors and outsourcing. These lead to variations in both managers’ and unions’ approaches towards outsourcing and in outcomes for pay and working conditions. We call for a strengthening of the inclusiveness of industrial relations structures to combat problems of workforce fragmentation caused by outsourcing.

Original languageEnglish
Pages (from-to)295-313
Number of pages19
Issue number4
Early online date1 Dec 2015
Publication statusPublished - Dec 2015


  • France
  • Germany
  • Hungary
  • labour market
  • local government
  • municipalities
  • outsourcing
  • procurement
  • public services
  • Sweden
  • UK

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