We can’t work it out

12

June 13, 2011 by Neil

Another Government, another job creation scheme, another waste of time and money.

Last Friday saw the launch of the latest employment white elephant, “The Work Programme” charmingly described by Employment Minister Chris Grayling as,

“a giant employment dating agency”

The concept is to use private companies to find employment for unemployed people and incentivise them to do so with the payments for success ranging depending on how unemployable the placed people are.  There are a number of serious faults with the scheme, many of which have more than adequately been highlighted by my friends at the Work Foundation:

  • Unemployment has huge regionality - if you’re unemployed in an area of high unemployment then incentives to contractors to find you work are not going to help one iota
  • Unemployment has huge emotional, social and psychological implications. Trying to solve it through a commissioned based system is a recipe for disaster – expect to hear stories of vulnerable people being ill-advised and placed in roles that are unsuitable
  • Private enterprise will focus on where it can achieve a return, not where it can be most socially useful
  • The scheme is focussed on demand side, not supply side

And this last point is the real issue, the real area where this and other job schemes come crashing down.  Employers don’t (generally) create jobs because of Government schemes.  There may be some headline grabbing stories – generally from retailers creating part-time, low paid jobs. But that hardly deals with the issues that are driving the unemployment figures – such as tens of thousands of public sector workers losing their jobs.

If we are serious about creating meaningful sustainable employment, we need investment in the key market sectors that Britain can be strong in. We need to invest in the knowledge economy, in creative industries, in R&D. We need to learn the lessons from the financial crisis and incentivise the development of a mixed economy. But perhaps most importantly we need to understand that the burden of tax on businesses needs to be reduced.  Business creates jobs when they are growing and investing in their future, not when they are holding their own or at worst contracting.

There is no genuine, long-lasting value behind “job creation” schemes or incentives, they don’t lead to a step change in the labour market, they are political window dressing that hide the main issues of economic frailty. Within the UK, if we are serious about solving the current unemployment situation (and we should be as it is a 17 year high) then we  need to create an environment that supports business growth, entrepreneurialism and innovation.

At the same time, we need to address long-term skills shortages, through significant investment in retraining and finally to support business development in those communities that have been devastated through long-term unemployment and public sector cuts.

The “Work Programme” does nothing to tackle the crux of our unemployment problem. It is time to grow up and start discussing the real issues that lie at the heart of the matter, only then will we take any meaningful steps forward.

12 thoughts on “We can’t work it out

  1. Really interesing post. I really enjoyed reading it.

    To me this smacks of politics and PR and rather than rearranging the deck chairs on the Titanic it would be far more productive to focus on building more ships….

    That being said I think there is a real opportunity to do something different with the mechanisms that help people who are unemployed find jobs. Having done “the walk of shame” several times during a period of unemployment I found the ‘placement’ competence within the Jobcentre organisation was very low. I agree with your point about protecting the well being of vunerable individuals and wouldn’t want to see a “just get temps out” mentality brought to this but at the same time the processes and structures that operate within JobCentre could benefit from a review side by side with those operated in the private sector. I am NOT (repeat NOT) advocating filling jobcentres with ‘Johnny Tempdesk’ but taking the high unemployment as an opportunity to increase the effectiveness of the JobCentres would be IMHO (did I say humble?) a valuable use of resources

    • Neil says:

      I totally agree with you Rob – a couple of years ago I questioned the competence of the JobCentrePlus regime and was met with a pretty fierce response about under staffed and over worked (which may well be true) but I think there is also a lack of skill/ability in placement and an over focus on administration.

  2. Unemployment rate falls, but remains ‘unacceptably’ high…

    The picture for UK unemployment appears to be showing some signs of improvement. Latest official unemployment data – published by the Office for National Statistics (ONS) this morning (Wednesday 15 June 2011) reveal falls on some (but not all) key meas…

  3. I know a couple of people who are involved with the mess that is the DWP and JobCentre at the moment. The reality is that once people have succumbed and have had to go down this route, there is little opportunity out. There may be for people in cities but for those who are living in more provincial places, work is scarce. The problem is that we are seeing (in the case of my friends) very highly skilled people being reduced to applying for the most pathetic of jobs, upon which they cannot afford to live – purely because they cannot financially afford to attend interviews more than a few miles from home. Professionals need to work with job agencies to find work yet the DwP in their infinite wisdom will not pay for people to attend interviews with agencies – only direct employers. Factor in travel costs, and this means that people have to spend one week’s bare bones survival money just in attending interviews.

    The system is the problem together with the lack of cognition that we are not in 1950′s England anymore where everyone signed on at the local factory. People have niche skills that are useful to businesses that may be geographically spread.

    It seems to me that we currently have thousands upon thousands of highly skilled people who are unemployed because they are finding it difficult to get traction as a result of being sunk within this most unsupportive systems. Real support is needed to get these people back to work, through imaginative schemes that perhaps support the starting of their own businesses, networking people with complimentary skills and many more similar ideas.

    With the current lot in power, I think we have little hope, this is a world that is beyond their imaginations.

    • Anna Meisel says:

      Julian, I’m a Radio 4 journalist currently working on a piece about the Work Programme. I am looking for people who are on the WP courses and wondered if you know anyone? Would it be possible for us to have a chat? My telephone number is 07706154283 and my email address is anna.meisel@bbc.co.uk

      I would appreciate if you could get in touch,

      Anna

      • Neil says:

        Anna, thanks for taking the time to read the blog. I’ll tweet the comment and see whether we can find anyone for you that way too?

    • Neil says:

      Thanks for commenting Julian and apologies I didn’t get around to responding sooner, I missed your comment until Anna drew my attention to it below.

      You make such valid points that I can’t really add that much, the system is outdated and not fit for purpose, but I’m not convinced that there is currently a plan for improving it that I have any faith in at all.

  4. Anna Meisel says:

    Neil – your help is much appreciated. Feel free to tweet my comment and pass my contact details to anyone who may know someone who is currently on the WP. What’s your interest in all this? Feel free to email me.

  5. [...] Neil Morisson’s blog, The Change Effect we see a similar comment from mastersorbust who had to do the walk of [...]

  6. [...] people than me have some great thoughts and debate: Neil on his Change Effect Blog with the post “We can’t work it out” Also Lee Cooper always has something to say on the skills gap topic, especially in his posts [...]

  7. [...] Neil Morisson’s blog, The Change Effect we see a similar comment from mastersorbust who had to do the walk of [...]

  8. [...] people than me have some great thoughts and debate: Neil on his Change Effect Blog with the post “We can’t work it out” Also Lee Cooper always has something to say on the skills gap topic, especially in his posts [...]

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