employment agency

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Former servicemen vying for jobs at the American Legion Employment Bureau in Los Angeles, 1921.

Encyclopædia Britannica, Inc.

employment agency, an organization to help workers find employment and employers find workers. Employment agencies may be either privately owned or publicly provided or managed. Their services are available to the unemployed, to those who seek different or better jobs, and to employers. A private employment agency may charge fees of the employer, the worker, or both. An agency may be local, national,or, in some exceptional instances, international in scope. Itsservices may be limited to certain trades and occupations or toclasses of workers (skilled or unskilled, male or female). Insome countries or under certain circumstances the notification ofvacancies may be obligatory upon employers, while refusal ofsuitable work offered may entail suspension or disallowance of anapplicant’s unemployment benefits.

Both in periods of national emergency when labour shortages are widespread and in normal times, public employment offices play a vital role in uniting the jobless and the job. They are relied upon to provide comprehensive, impartialinformation about opportunities for employment and to disseminatethis information to those who need it. In complex industrialsocieties with continuously changing technology, problems of unemployment have prompted a reevaluation of the role and servicesof public employment systems.

The public employment service system in theUnited States evolved from a combination of city, state, and federallegislation over a period of about six decades. In the U.S.,as in Europe, the first publicly financed employment offices wereestablished by individual municipalities: New York City in 1834;San Francisco in 1868; Los Angeles and Seattle in 1893; Duluth, Minnesota; Sacramento, California; Butte, Montana; and Tacoma, Washington between 1899 and 1906. The increasing number of free, municipally operatedemployment offices usually catered to unskilled and casual labour.The recurrence of periodic unemployment, the complaintsagainst private employment agencies, and the lack of farm labourin many states were largely responsible for the entry of severalstates into the field of employment services. In 1890 Ohio establisheda state-directed system and a number of other states quickly followed suit.

By 1923 public employment office lawshad been enacted in 32 states. The municipal employment officeswhich continued to exist in some cities were quite inadequateand failed to provide an effective organization of the labourmarket in their communities. Little attention was devoted tothe problems of administration; there was no uniformity in theirrecords or standards, no cooperation between offices, and no specifiedpolicies of office management. Thestate services gradually became aware of the need for administrative,program, and policy ties with state-administered offices in other areas. This clearly called for a federal institutioncapable of tying the state agencies together into a cohesive,integrated system with comparable programs, policies, standards,and operating practices.

The federal government’s public employment work began in 1907 when the Bureau of Immigration and Naturalization began to distribute immigrant labour among the states. In 1914 the Immigration Service developed the beginnings of a nationwide information system about employment opportunities. The entrance of the United States into World War I intensified the need for an organized public employment system.

A newly created unit in the federal Department of Labor, the United States Employment Service (USES), established a national network of community advisory boards on labour recruitment, but the activities of this unit were sharply curtailed by reduced appropriations at the end of the war. State and municipal officeswere left with the job of organizing the labour market. Unsuccessful attempts to establish a federal-state employmentservice included the Kenyon-Nolan Bill (1919) and the WagnerBill (1931), vetoed by Pres. Herbert Hoover, who believed a federally administered agency was necessary to meet the overwhelming problems of the Great Depression. Finally, in 1933, the USES was reestablished by the Wagner-Peyser Act as a bureau of the Department of Labor. It was charged with encouraging theestablishment of state-administered employment offices and providingfor federal grants to defray operating costs. The law madeit the duty of the USES to “promote and develop a nationalsystem of employment offices for men, women, and juniors,” The federal service was to prescribe minimum standards, develop uniform administration and statistical procedures, publish employment information, and promote a system of clearing labour between states.

Creation of a federal-state employment service in the midst ofa serious economic depression inevitably involved the new bureauin developing emergency programs for public works and workrelief projects. The national reemployment service was set upunder the direction of the USES to refer workers to public worksand relief projects. The USES and the national reemploymentservice were immediately involved in mass registration and referralsof several million jobless workers.

Following enactment of the Social Security Act in 1935, thefunctions of the employment service were enlarged because allstates that sought to participate in the federal-state unemploymentinsurance program were required to provide that such insurancebenefits would be paid only to registered claimants througha state public employment office. This new responsibility requireda work availability test for applicants of unemploymentinsurance and forced a major expansion in both federal and stateservices. As a result, within a few years after the enactmentof the enabling legislation in 1936, a state employment serviceoperating in collaboration with the USES had been establishedin all states.

During World War II and the Korean War the nation reliedheavily upon the public employment services for the allocation ofhuman resources. Hundreds of thousands of workers were recruited forwartime training programs; millions were placed in critical industries;the wide-ranging activities of the employment serviceprovided employers and unions with the opportunity to see therole of public employment offices in contributing to the stabilityand improved functioning of local labour markets.Public interest in manpower utilization and the organization ofthe labour market continued to increase after World War II.

Recurring recessions, persistent unemployment, technological advances, changes in the composition of the labour force, increasingeducational requirements for jobs, decline in employment in certainsegments of the economy (e.g., railroads, coal mines, andagriculture), changing patterns of consumer demand, and thedistress of areas experiencing exhaustion of natural resources orthe out-migration of industry forced reconsideration of the roleand services of the USES and the role that the government shouldplay in solving unemployment. Measures adopted included theArea Redevelopment Act (1961, revised 1965), the ManpowerDevelopment and Training Act (1962), the Vocational EducationAct (1963), and the Economic Opportunity Act (1964). In 1998 the Wagner-Peyser Act was amended, and the USES was folded into the Department of Labor Employment and Training Administration (DOLETA) as part of the One-Stop (later CareerOneStop) workforce program. The Workforce Innovation and Opportunity Act (2014) realigned the federal employment, training, and career development system for the 21st century, but much of its core mission remained unchanged. The program continues to make labour surveys, certify training needs, provide testing and counseling, expand job placement for persons trained, and provide information and guidance on occupationalneeds.