A move by the provincial government to partially privatize employment services is causing ripples in the Hamilton employment services network. Currently there are more than ten private agencies administering Employment Ontario services in Hamilton. They help persons looking for work develop a resume and other services to help people become employment -ready. The Province recently announced a plan to contract with third party organizations, who would now oversee employment service delivery by local agencies. The Hamilton contract went to Fedcap—a US based group of companies that got its start in the 1930’s as an employment service for persons with disabilities; but now has branched out to provide a wide range of employment services in several countries.

A Ministry of Labour memo says Fedcap will assume control of the entire employment network in Hamilton. Private service providers currently offering employment services—The YM-YWCA, Mohawk College, Employment Hamilton and several others– will report to Fedcap who, starting in October will decide which agencies will continue to receive employment contracts. Part of Fedcap’s mandate is to improve the efficiency of the system. The memo says that in future third party agencies “will be paid on their results.” In 2016, the Auditor General criticized Ontario’s employment and training programs, saying they were not effectively helping people find and keep full-time jobs. Then last winter the government announced its plan to “modernize Ontario’s employment services by creating a new service delivery model that integrates social assistance employment services into Employment Ontario.”

The Bay Observer contacted a number of employment services providers, none of whom would speak on the record for fear of running afoul of Fedcap at this early stage of the process where Fedcap is evaluating the local agencies, but the government shift in strategy has agencies nervous. One of the oldest employment agencies in Hamilton is Employment Hamilton, founded by the late John Buttrum in the 1970’s. At that time unemployed people were served by federal government employment offices located in the Federal Building. It was an impersonal and bureaucratic system. Buttrum was a pioneer in providing third party delivery of employment services supported by government contracts, and his approach attracted favorable attention from academics and welfare administrators. As the number of service providers mushroomed over the years, the field became crowded, with agencies competing for clients. Buttrum worried that agencies would focus on working with clients that were relatively easy to place in employment in order to show good results to the provincial funder. A government background document suggest finding work for disabled and otherwise hard-to-place candidates will become a priority in the new system.

The government backgrounder refers to the new system as a “reform” of the current system that will “create an efficient employment service to meet the needs of all clients, including those on social assistance or with a disability, be more responsive to local labour market needs and drive results for job seekers, employers and communities.

The city of Hamilton is also a provider of employment services, mainly to persons receiving Ontario Works assistance. General Manager of Healthy and Safe Communities Paul Johnson says the changes could affect as many as 30 people in his department. He noted that his department often works with some of the people hardest to place—those with addictions and disabilities. Johnson assumed control of the department following the release of a scathing report that among other matters criticized the department for poor morale and inefficiency in helping clients exit social assistance.

Private sector service providers told the Bay Observer “there is a lot of anxiety not knowing how future funding will work.” They expressed concern about the adjustment agencies will have to make transitioning from dealing directly with the government to now working with a private sector entity. For its part, Fedcap’s website says, “The Fedcap Group has more than 80 years’ experience developing innovative, sustainable solutions and creating measurable changes for those with complex needs. The Fedcap Group has tremendous results in breaking down barriers to societal inclusion and financial well-being working with more than 320,000 people each year.”

Caption: Private agencies administering Employment Ontario services are facing a shakeup in the way they operate in future