Affiliations: Trondheim Business School, HiST, N-7004 Trondheim,
Norway | Department of Psychology, NTNU, N-7491 Trondheim,
Norway
Note: [] Address for correspondence: Ove Gustafsson, Assistant professor,
HiST/TBS, N 7004 Trondheim, Norway. Tel.: +47 73559941; E-mail:
Ove.gustafsson@hist.no
Abstract: An outsourcing process in a medium-size city, by Norwegian
standards, provided the background for our study. In 1996, the city council
decided to contract out the refuse collection in half of its total area (the
western part of the city), and to let the public refuse collection enterprise
continue to collect in the other half of the area. The public enterprise also
participated in the competitive tender, without success, however. The bid submitted by the public refuse collection enterprise was
used as the basis for a benchmarking process performed by the chief
administrative officer of the city in May 1999. The process resulted in the
requirement that the public enterprise downsize its number of refuse collectors
by 27 per cent. The city thus acquired a more cost-effective refuse collection
system both in the western part, now run by a private company, and in the rest
of the city, where the collection remained the responsibility of the public
enterprise, in its newly pared-down and reorganized version. Detectable changes in the refuse collectors' health status in the
three-year period immediately following the outsourcing constitute our main
focus in this study. We found that the downsizing and reorganization of the
public enterprise had a negative impact on the refuse collectors' health
status. One year after the downsizing, six of the 27 refuse collectors
remaining in the public enterprise had been diagnosed with heart problems or
musculoskeletal pains that were sufficiently serious to form the basis of their
individual approaches to secure a disability pension, which all six were in the
process of acquiring. The registered sick leave among the refuse collectors
showed a dramatic increase during the same period. We found clear indications
that the refuse collectors remaining in the employment of the public enterprise
had no alternatives in the labour market. Although not the focus of this study, we found that the totality of
costs and benefits, not only for the enterprise in question, but also for local
and national authorities, needs to be considered in any realistic assessment of
the impact of public sector outsourcing of activities.
Keywords: downsizing, health condition, predictability, affective commitment, early retirement
