The target group of workers

PHS activities can target different groups of workers. The main types of target groups are:

• Low-skilled individuals
• Women
• Migrants
• Long-term unemployed individuals
• Formal versus undeclared provisions

First, services might be provided by formal service providers or by undeclared workers. As discussed further in the next section, the use of undeclared service providers has considerable negative consequences for society (tax losses, for example).

Different types of (formal) service providers

Within the formal market, the type of service providers allowed to provide PHS may also vary. We can distinguish the following types:

• Public organisations (or those linked to public authorities);
• Private profit and non-profit organisations;
• Self-employed individuals;
• Users directly employing workers.

Different types of competition between services providers

We can also distinguish the following types of competitive relations that could exist between services providers:

• Open competition: Standard form of competition where all qualified or responsible parties are eligible to compete. In this case, particular attention should be given to the various supply-side support forms available so that tax and regulatory framework neutrality towards all type of providers is ensured.

• Quasi-market: In ‘quasi’ markets, both supply and demand sides differ fundamentally from conventional markets. Theorists define quasi-markets using certain criteria that distinguish them from conventional markets. The criteria include the facts that:
  • Quasi-markets are established and maintained by the public sector.
  • Services produced in quasi-markets usually fulfil the objectives of social profitability and welfare.
  • The public sector is usually the subscriber, regulator and purchaser of the service.
  • There may be different kinds of producers in quasi-markets competing with each other (for-profit and non-profit organisations, both public and private sectors)
  • The user of the services does not normally pay for service at the point of consumption; money flows between the (public sector) purchaser and provider.

• Monopolistic situation: A situation in which a single company or group owns all or nearly all of the market for a given type of product or service. By definition, monopoly is characterized by an absence of competition, which often results in high prices and inferior products.

The potential presence of intermediaries and the forms of employment relationship

Finally, another important feature of the supply side is the presence (or not) of intermediaries between the users and the workers. This has important consequences, including on the employment model in PHS. In total, two different employment models for services provision can be distinguished:

• On one hand, workers who are directly recruited by private individuals or households to perform domestic tasks in their home. This direct employment is characterised by a bilateral relationship between the user (who is also the employer) and the worker. In this form of employment relationship, there is less control over the quality of the job done by PHS workers. This form of work is also widely perceived as ‘domestic’ work and could lead to some social disapproval.

• On the other hand, workers who are employed by an organisation (private or public, for profit or not). There is an “intermediated” or triangular form of employment, whereby the worker is employed by a company who sells services on the market or by an organisation providing the service (e.g. a public organisation). The beneficiary of the service simply buys this service on the market or receives the service from public entities. In this form of work, organisations are the employers of PHS workers. There is more control over the quality of the PHS jobs and services provided. This reduces the administrative burden of users, the problems related to the social disapproval of hiring somebody to perform domestic work and some cultural barriers associated with the outsourcing of domestic work.