In recent decades, Germany has turned away from regular employment for the non-established, with employment entrance becoming the most insecure phase of a career. The public-sector employment regime, with its specific institutional setting, has been seen as a "model employer” for disadvantaged groups, but reforms and restructuring are increasingly calling this special status over the private-sector into question. This article examines whether the public sector provides more stable employment for entrants than the private sector. It is investigated whether the institutional structure of the public sector positively influences employment stability.

In a khb-decomposition-analysis, it tests potentially stabilizing (working in a service relationship, high occupational closure, participation in further education) and destabilizing institutional factors (fixed-term and part-time employment) to explain the stability of first jobs in the public sector. Using the labour market entry cohorts 1995 to 2012 of the retrospective life history data of the Starting Cohort 6 of the National Education Panel Study (NEPS).

The results show that the public sector is offering more stable first jobs, and stabilizing factors, like further education are influential. However, destabilizing factors, like the intensive use of fixed-term contracts, have a significant negative impact. This suggests that the stabilising institutional structure of the public sector, while functioning, is under pressure and thus offers potential for polarisation.