| Issue 15 | October 2009 |
The focus of this e-bulletin from the UK Commission for Employment and Skills is on employment and skills issues from research and policy perspectives.
Spotlight Feature
In this edition's spotlight feature we examine the Flexible New Deal. This new programme, which aims to find more effective ways to help long-term unemployed people into work, replaces the New Deal active labour market policies introduced by the UK Government in 1998.
Content
this month includes...
Employment
Evaluation of Partners Outreach for Ethnic Minorities
Research on Recession Britain
Report on Measuring Economic Performance and Social Progress
Forum on Green Jobs
Extra Support for Workers with Mental Health Conditions
Northern Ireland Consultation on Flexible Working and Time to Train
Where will Jobs be Created in the Next Economic Cycle?
Jobs of the Future
Flexible Policy for More and Better Jobs
Skills
Ambition 2020 Technical Report
Evaluation of Train to Gain
Longitudinal Study of Further Education Learners
Destination of Higher Education Leavers
The Future of Adult Learning and Social Cohesion in Scotland
Competitiveness
Teamwork, Productive Potential and Employee Welfare
CBI Report on Business and Universities
Innovating out of Recession
The Future of UK International Financial Services
Media, Technology and Cleantech Tipped to be Highest Growth Sectors
ONS – National and Regional Monthly Labour Market Statistics
| Employment |
Research and Evaluation
Evaluation of Partners Outreach for Ethnic Minorities
The Department for Work and Pensions (DWP) has published a research report on the evaluation of Partners Outreach for Ethnic Minorities (POEM). The Institute for Employment Studies (IES) conducted the evaluation of the programme, which ran from February 2007 to March 2009 in 430 wards in six English cities. POEM was aimed at non-working partners in low-income families from ethnic minority groups who faced particular barriers to employment. The main purpose of the programme was to help these hard-to-reach people into employment or at least reduce their distance from the labour market. The research was based on interviews with DWP staff, case study work with POEM providers and face-to-face interviews with clients. It found that the programme achieved 85 per cent of its recruitment target over the two years (9,614 out of 11,368) and also 85 per cent of its target number of people finding employment (2,835 out of 3,323). Analysis of the two years separately shows significant improvement in job entry performance in year 2. Providers attributed this to a better understanding of the client groups by year 2 and also a greater build up of expertise in finding suitable work and partnerships with employers.
An important part of building this expertise involved identifying the key barriers to work and learning lessons on the best way to engage and recruit clients to the programme. Lack of confidence, lack of UK work experience, low English language levels, and social and cultural barriers were found to be key issues in gaining employment, while some of the lessons learned were that:
- Outreach should be at the local community level;
- Using multilingual workers from the target communities was vital;
- Providers need sufficient start-up time to test what methods work best;
- Word of mouth is an effective tool for recruiting people from the target communities.
- Providing a tailored and flexible one-to-one service was considered to be a core part of POEM.
In addition to the job entry performance of the programme, key soft outcomes were identified that were important measures of distance travelled. These were: greater confidence and motivation; increased awareness of work opportunities; skills in job searching, applications and interviews; and improved English language.
Full details here
Research on Recession Britain
A new report from the Economic and Social Research Council (ESRC) uses the findings of a wide range of research projects to gather insights into the current recession in the UK. It looks at evidence from the recessions of the 1970s, 1980s and 1990s as well as recent economic trends in order to understand the causes of the downturn, the prospects for the future and what policies may be the most effective. It also seeks to learn about the possible effects of the recession on jobs, businesses and people’s lives.
On jobs, the report finds that:
- It can take several years for unemployment to fall back to its pre-recession levels.
- A major shift in Britain’s economic geography is considered to be unlikely.
- The ‘middle-class recession’ that some had predicted has not materialised as low-educated, low-skilled workers’ employment prospects have suffered the most.
- With present access to early retirement benefits more restricted than in the past, employment among older workers may not be as sensitive to the economic cycle.
- As in previous recessions, younger workers are being hit particularly hard with unemployment most volatile for 18-24 year-olds.
- The UK Government’s targets for the number of young people staying on in education may be more easily met as a result of rising unemployment.
- The generation of graduates joining the labour markets during this recession could experience lifetime earnings losses, compounded by the increased supply of graduates and lower returns to a degree for some.
Financial uncertainty, falling house prices, declining consumer spending and the prospect of cuts in public expenditure are further repercussions of the economic downturn noted by the report. The findings on business suggest that productivity will rise as weaker firms close and that the recession may stimulate innovation and new management practices. In addition, the effect that recessions can have on people’s lives is described with particular reference to the impact of unemployment on mental and physical health and on relationships with other people. It is suggested that due to unemployment benefits falling relative to average incomes over the past 20 years, the current recession could have a particularly big impact on the relative living standards of those losing their jobs.
Full details here
Report on Measuring Economic Performance and Social Progress
The limits of Gross Domestic Product (GDP) as a reliable indicator of economic performance and social progress is the subject of a report from the Commission on the Measurement of Economic Performance and Social Progress (CMEPSP). The CMEPSP was created at the request of French President Nicholas Sarkozy and is composed of experts from universities, governments and intergovernmental agencies in the USA, France, the United Kingdom and India. In the context of an increasing level of importance of statistics for designing and assessing social policies, it considered problems of measuring GDP and what additional information is required to produce more relevant social indicators. Issues such as environmental change and the well-being of citizens are considered to be under-represented in currently popular measures. There also appears to be a gap between the picture painted by official figures and what public perceptions are and in countries such as France and the United Kingdom there is a widespread mistrust of official statistics.
In the current climate of financial, economic and social crisis, addressing the shortcomings of measures of social progress could de-escalate certain problems. The structural evolution of modern economies, along with the growth in complexity of products on the market, are given as reasons for the measurement of output and economic performance being more difficult than before. In addition, simply measuring public provision of individual services according to the inputs used to produce them is considered to be inadequate because it ignores productivity change in the provision of the consequent service outputs. The CMEPSP calls for a new, plural system that encompasses a range of different measures and also documents the diversity of people’s experiences. The report sets a series of recommendations for action, including:
- Income and consumption should be used to evaluate material well-being rather than production.
- Measures of household income and consumption are the best way to follow trends in citizens’ material living standards.
- The distribution of income, consumption and wealth should accompany overall average indicators.
- Measures of people’s health, education, personal activities and environmental conditions need to be improved.
- Both objective and subjective measures of well-being are important for providing key information about people’s quality of life.
Full details here
Policy Analysis
Forum on Green Jobs
An article in a recent edition of Social Agenda (a publication from the European Commissionon employment and social affairs) reports on an EC forum on the impact of climate change on employment. The meeting of representatives of trade unions, employers and governments looked at potential job losses and anticipated how many jobs would be created due to climate change. It also considered how skills and qualifications will have to evolve and the possible role of social partners. Issues were addressed such as research and training needs, how employees can contribute to job transformation and the regional aspects of climate change.
Green jobs are defined as those that make an appreciable contribution to maintaining or restoring environmental quality and avoiding future damage to the Earth’s ecosystems. It is estimated that 21 million workers across the European Union were employed in green-related jobs in 2005. The article highlights the renewables sector (which includes wind, solar and hydro-electric power as well as geothermal energy and biomass) as having a high potential for job creation and speculates that jobs in this sector could be set to double over the next decade. A third of this employment growth is expected to be in skilled jobs leading to some concerns in the industry about a shortage of qualified employees.
Full details here.
The full reference of the article is: EC Restructuring Forum (2009) ‘Green jobs for a greener economy’, Social Agenda, No. 21, July 2009, pp.7-9.
Extra Support for Workers with Mental Health Conditions
The UK Government has announced plans to extend a scheme to help thousands of people with mental health problems to remain in the workplace. With the assistance of mental health charity Mind, pilots have already taken place that have proven to be 90 per cent successful in giving people extra support in managing their condition so that they can retain their jobs. The intention is now to provide the support nationally through a range of providers.
Along with this announcement, the Government listed other measures to aid disabled people, including those with mental health problems. These are:
- A National Strategy for Mental Health and Employment in the autumn that will include expectations of employers, healthcare professionals, organisations and individuals for improving well-being in the workplace.
- A consultation with mental health expert Dr Rachel Perkins and Chief Executive of Mind Paul Farmer on better ways to help people with mental health problems return to work.
- Coordinated support for people who have mental health conditions through a network of mental health experts in Jobcentre Plus along with colleagues in the health system.
- A consultation on Right to Control, which will give individuals more influence on how money is spent to meet their individual needs and ambitions.
- The Access to Work fund to be doubled over the next five years from £69m to £138m. This is for disabled people and their employers so that they can receive practical advice and financial support to help them overcome work-related obstacles.
Full details here
Northern Ireland Consultation on Flexible Working and Time to Train
The Northern Ireland Government’s Department for Employment and Learning (DELNI) have published a consultation document on Time to Train and Flexible Working. Similar consultations on the right for employees to request time to train from their employers have taken place in England, Scotland and Wales, the outcomes of which were reported in March’s edition of Intelligence. Excluding Northern Ireland, the right to request flexible working was extended from covering parents of children under 6 years of age (or 18, if the child has a disability) to all those with children under 16. The consultation proposes that this extension will also apply to Northern Ireland.
DELNI hopes that the new right to request time to train will encourage employers to invest in the skills of their employees as well as raising employees’ awareness and aspirations in relation to skills. The two issues are part of the same consultation because of the similar ways that the rights are framed. This is in terms of how the requests are to be made by employees, on what grounds employers can turn down requests and how employees can appeal against decisions that are made. The proposals state that employers will have a duty to seriously consider any requests and must have genuine business reasons to turn them down.
Analysis of the consultation responses will help to inform DELNI’s policy response, which the Department plans to publish early in 2010.
Full details here
Where will Jobs be Created in the Next Economic Cycle?
The Institute for Public Policy Research has published a paper that makes recommendations to help the UK economy make a sustainable return to full employment. The Institute argues for the state to have a larger role in influencing the economy. It is also suggested that the UK Government, finance and housing sectors can no longer be relied upon as sources of employment growth. Furthermore, it is observed all sectors have been affected by the economic downturn with manufacturing being the hardest hit. These factors have led to uncertainty regarding which sectors will lead the recovery in terms of job creation. The report focuses on areas of potential growth, such as high-tech manufacturing, creative industries and pharmaceuticals, which may require assistance from government in terms of supporting training and innovation. 22 policy recommendations for government action are set out with the aim of creating 1.5 million new jobs in sectors where the UK has a comparative advantage. These include:
- Greater funding and subsidies for those studying science, technology, engineering and maths (STEM) subjects;
- A new national system of transferable credits for all university, further education and work-place training courses;
- Training to become part of the collective bargaining process so that union learning-representatives have more power to demand training; and
- A commitment to lifelong learning that includes a nationally recognised and transferable qualification for apprenticeships.
Full details here
Jobs of the Future
The view of the Department for Business, Innovation and Skills of future prospects for the domestic and international labour market has been presented in a report entitled Jobs of the Future. It outlines the ways in which the Government expects the labour market to change, what sectors are expected to grow and which ones may decline. The impact of globalisation and the associated increase in the number of companies operating internationally is discussed. These developments have contributed to a shift in the UK economy from manufacturing to service industries and a rise in demand for supporting ICT, business and financial services. These sectors are seen as being areas of the biggest gain in employment, along with sporting, recreational, cultural, social and personal services.
The development and delivery of sustainable low carbon products and services is regarded by the Government as an ‘unprecedented commercial opportunity’ and it makes reference to the ‘Low Carbon Industrial Strategy’ as action it has taken in this area. The Digital Britain White Paper and the Life Sciences Blueprint are other policy documents referred to as attempts to ensure the appropriate levels of skills and innovation to be ready for anticipated changes. The report provides brief analysis and an outline of Government plans for several other industries including advanced manufacturing, creative industries, business and professional services, care, retail and tourism. It includes by acknowledging the increasing need for high level skills, not only in knowledge-based industries, but in all industries where there will be a large number of jobs on offer.
Full details here
Flexible Policy for More and Better Jobs
The Organisation for Economic Cooperation and Development (OECD) has published a collection of articles on the issue of flexibility in the management of labour market policy. It follows a conference of ministers and high level officials held in Venice in April 2008 on the theme of decentralising labour market policy. The OECD’s Local Economic and Employment Development (LEED) Committee has been working on a research agenda to investigate experiences in OECD countries in activities such as decentralising policies, establishing new forms of governance, co-ordinating workforce and economic development policies, and designing integrated skills development strategies.
The concept of flexibility refers to the ability to adjust policy at its design, implementation and delivery stages to make it better adapted to local contexts. This latest report in the LEED series compares the degree of flexibility allowed at various governance levels in OECD countries and assesses the most direct impacts of flexibility on employment outcomes. The most important challenges in balancing flexibility are identified. It suggests that labour market agencies and institutions need to adapt themselves to new priorities, such as helping workers to compete on the global market and helping regions to nurture high-level skills. The analysis presented in the report is used to demonstrate that the formal distribution of power is less important than the actual flexibility available to actors at different levels within the system. It is noted that demand for more proactive local employment agencies has profound implications for how government policies are developed. The research on employment policies in OECD countries has found that in those countries where decentralisation has led to increasing flexibility at the regional level, it has yet to filter down to the local level with the setting of eligibility criteria and performance targets the areas of least flexibility for local level actors. However, econometric analysis is presented to show that sub-regional flexibility is positively and statistically significantly related to employment rates, possibly because sub-regional flexibility leads to more responsive and customised active labour market programmes.
To access a browsable version of this publication, click here
| Skills |
Research and Evaluation
Ambition 2020 Technical Report
In May of this year the UK Commission for Employment and Skills published its first annual assessment of progress towards making the UK a world leader in employment and skills by 2020 – Ambition 2020: World Class Skills and Jobs for the UK. The UK Commission has now published a technical report to accompany this publication which details the sources and methods underpinning the forecasting models used to make this assessment.
Ambition 2020 monitors progress on our World Class Skills and Jobs Ambition and against our international competitors in the context of (i) the ‘Leitch’ Ambition for 2020; and (ii) the aims and priorities for the four nations of England, Scotland, Wales and Northern Ireland. It provides a sound evidence base for advice on strategies, policies and measures needed to increase skills, employment and productivity. The Ambition 2020 report provides the baseline from which to assess future progress.
The Leitch review set the ambition for the UK to become a world leader in skills by 2020, moving the UK into the top eight in the world at every skill level. Leitch identified the need to commit to four objectives:
- 95% of adults to have functional literacy and numeracy (basic skills), up from 85% literacy and 79% numeracy in 2005.
- More than 90% of the adult population qualified to at least Level 2, with a commitment to achieving World Class skills.
- Shifting the balance of intermediate skills from Level 2 to Level 3.
- World Class high skills, exceeding 40% of the adult population qualified to Level 4 and above, with an increased focus on Level 5 and above skills.
To monitor UK progress towards this World Class Skills and Jobs Ambition the UK Commission models for the Ambition 2020 report forecasted:
- The 2020 qualifications profile for the UK and for individual UK nations;
- The UK 2020 basic skills position for literacy and numeracy;
- Our 2020 international ranking vis-à-vis OECD countries for (i) below upper secondary (‘low skills’), (ii) upper secondary (‘intermediate skills’) and (iii) tertiary (‘high skills’) levels of education.
The Ambition 2020 Technical Report details the sources and methods underpinning these forecasting models. The report also outlines the UK Commission’s 2009/10 programme of development work, which will further build upon the models that report progress towards our 2020 Ambition for skills.
Ambition 2020 Technical Report is available here
Ambition 2020: World Class Skills and Jobs for the UK is available here
Evaluation of Train to Gain
The National Audit Office (NAO) has published a report that evaluates the performance of Train to Gain in its first three years. The initiative, which consists of full public funding of training for eligible employees, a skills brokerage service for employers and the delivery of flexible training is said to have cost £1.47 billion by March 2009 and has a budget of £925 million for 2009-10. The evaluation looks at the achievements of the Train to Gain service, how it has responded to employer demand for training and also how well the supply of training has been managed. The report also outlines the roles of the Learning and Skills Council (LSC), skills brokers and training providers. NAO’s research involved analysis of Train to Gain performance data, a literature review, meetings with government departments and stakeholders and focus groups with brokers and training providers.
Among the achievements listed for the service are that there has been a large increase in the amount of training aimed at meeting employers’ needs with 1.25 million people having started training by April 2009 and over 550 000 having gained a qualification. Most employers reported that the training had given their employees useful job-related skills and that their long-term competitiveness had been improved. The report also states that learners felt that they had improved their work skills, self-confidence and attitude. Around one quarter of employees said that they had received either a pay increase or a promotion as a result of gaining a qualification. Skills brokerage is observed to have contributed around 20 per cent of all Train to Gain learners through its efforts to engage ‘hard to reach’ employers.
The evaluation highlights survey evidence suggesting that 50 per cent of employers might have still arranged the training in the absence of Train to Gain. It also reports that initial targets were ‘unrealistically ambitious’ and that there was ineffective implementation of the programme. This has led the NAO to contend that the service has not delivered good value for money. A perceived challenge related to the service is that employer demand has increased significantly meaning that the LSC has had to tighten its contractual controls to avoid the financial dangers of demand being higher than the budget can cope with. This, however, is considered to be a way of improving value for money by focusing on the areas of greatest need.
Full details here
Longitudinal Study of Further Education Learners
The Learning and Skills Council (LSC) has published report on a study (by IFF Research) that assesses the longer-term perceived impact of further education (FE) on people who were claiming out-of-work benefits when they embarked upon a course. Learners were originally interviewed during the summer of 2007 (at least a year after they had completed their course) and again around 18 months later. The objective was to determine whether, with the aid of hindsight, learners felt that their course had a positive impact on their employment, career progression or progress into further and higher levels of learning. Among the key messages from the research were the following:
- Compared with summer 2007, there was a significant increase in the proportion in paid employment.
- A large majority of learners reported some lasting benefit from the course, with improved subject knowledge, increased confidence and improved IT skills among the most commonly cited returns.
- 61 per cent of those in employment late in 2008, who were not 18 months previously, felt that their original course was either vital or helpful in enabling them to find a job.
- 44 per cent of learners have been involved in further learning since summer 2007, usually at a higher level and, in addition, 73 per cent said they were likely to undertake more learning in the next two years.
- Of those who were still not working, almost two thirds thought that the course had improved their chances of finding a job.
Full details here
Destination of Higher Education Leavers
The Higher Education Statistics Agency (HESA) has published the latest findings of a longitudinal survey of leavers from higher education (HE) institutions. The 2004/05 leavers’ cohort was the subject of the survey, which received 41,395 responses, and so the report provides an overview of activities 3.5 years after graduation. It also looks at the conditions of the leavers’ employment, the extent to which they have been involved in further studies and their satisfaction levels with the HE experience.
Among the findings were:
- 76.1 per cent of leavers were in full-time paid work only.
- Leavers who had studied on courses based in medicine and dentistry, engineering and technology, or business and administration were the most likely to be in work (97.2 per cent, 94.3 per cent and 93.5 per cent of leavers respectively).
- 81.1 per cent of those leavers engaged in some form of employment were working in ‘graduate’ occupations.
- The (median) average salary for leavers of full time (including postgraduate) courses in full time jobs was £24,500.
- 54.8 per cent of UK-based leavers in employment were in the same region as the HE institution at which they had studied.
- Since leaving in 2004/05, 38.2 per cent of the cohort had gained a further qualification.
- 11.7 per cent of leavers reported at least one period of unemployment since 2004/05.
Full details here
Policy Analysis
The Future of Adult Learning and Social Cohesion in Scotland
There should be a public inquiry into Scotland’s lifelong learning system, according to a leading academic from the University of Stirling. This conclusion was made by Professor John Field of the Stirling Institute of Education in a paper presented to a conference on the future of adult learning in Scotland earlier this year. It was based on analysis of research findings on the relationship between lifelong learning and social cohesion. In his paper, Professor Field looks at levels of participation in adult learning and considers what the system appears to be likely to contribute to social cohesion in the future.
The paper notes past research which has found that adult learning has a positive relationship with active citizenship and also helps participants to gain confidence. However, it is also acknowledged that it can create and reinforce inequalities. Participation levels in adult learning in the UK are noted to be relatively high compared with most European countries though Professor Field asserts that those averages conceal big differences in the participation rates of different social groups. Scotland shares the UK’s high overall participation rates and job-related training is actually slightly higher in Scotland than in the rest of the UK.
Professor Field argues that the strengths and weaknesses of Scotland’s lifelong learning system need to be established clearly in order for there to be a better understanding of how it connects with strategies for social cohesion and economic growth. He suggests some policy priorities for improving the system, such as tackling skills utilisation, meeting the skills needs of the knowledge economy and reorganising the responsibilities of the various levels of government to suit Scotland’s needs better.
Full details here
| Competitiveness |
Teamwork, Productive Potential and Employee Welfare
The ESRC Centre on Skills, Knowledge and Organisational Performance (SKOPE) has published a paper that discusses the benefits of teamwork to organisations’ productivity and individuals’ well-being. In light of its apparent growth since the early 1990s, the paper looks at the argument found in academic literature that teamwork is associated with more opportunities for self-development on the job, stronger employment commitment and higher employee well-being. This is contrasted with the view that employers use working in teams as a method of work control so that it undermines individual discretion, increases work pressure and reduces employee well-being.
The British Skills Survey Series is used by the authors to counter a lack of empirical evidence on the subject. Their analysis finds that there are different types of teamwork to be found in Britain’s workplaces. Self-directed teamwork has become less prevalent over the last couple of decades while there has been a growth in teams that are largely dependent on external control. Looking at these different types of teams, the paper supports the argument that those teams with greater levels of autonomy are characterised by stronger motivation and higher potential employee productivity. However, all types of teamwork appear to be associated with higher levels of work pressure and this may have a detrimental affect on well-being. The paper concludes with the observation that the type of teamwork that has grown the quickest (non self-directed) seems to have the fewest advantages for either management or employees, while the most beneficial forms of teamwork have been in decline.
Full details here
CBI Report on Business and Universities
The Confederation of British Industry (CBI) has published a report by its higher education task force looking at how businesses can work with universities to help maintain the UK’s international competitiveness. It calls for changes to the financing, structure and mission of universities. This includes a rethink of tuition fees with recommendations to increase fees and remove the interest rate subsidy on student loans.
The report sets out what business wants from higher education including raising the number of science, technology, engineering and mathematics (STEM) graduates, ensuring all graduates have employability skills and improving the conditions for university-business collaboration on research an innovation. It also suggests ways that businesses can support students, such as giving them real-life projects to do as part of their degree, providing more internships and sandwich placements and offering guidance on the nature of employability skills in all subjects.
Full details here
Innovating out of Recession
Collaboration between higher education institutions and businesses is also the subject of a paper published by Universities Scotland, which examines what universities can do to help industry through the economic downturn. Six main areas are identified where universities are said to be having an influence. These are:
- Consultancy to small and medium sized enterprise (SMEs). Activities include research and consultancy contracts between SMEs and higher education institutions and additional training provided by universities to help SMEs understand the economic climate.
- Innovation and knowledge transfer. This involves providing businesses with access to the knowledge and expertise of universities through student placements, innovation networks and continuing professional development.
- Engaging with business. The Interface service helps businesses who want to work with Scotland’s universities.
- Skills, training and workforce development. Some universities have created extra bursary or scholarship schemes for postgraduate courses that will contribute some of the higher level skills that Scotland will need when the economy has recovered. Universities are also looking at changing the structure of their courses so that there are more part-time or work-based courses and more courses that focus on specific skills development.
- Supporting the community. Universities have supported those who have been made by providing advice on finding work or gaining new qualifications.
- Cultural and societal engagement. This relates to the general contribution of universities to Scotland’s economic, social and cultural wellbeing, noting that around 34,000 people are employed in the sector and their international status often helps to attract investment from abroad.
The paper also includes case studies of activities under each of these headings.
Full details here
The Future of UK International Financial Services
HM Treasury has published a report written by the Financial Services Global Competitiveness Group on how UK financial services can be certain of international competitiveness over the next 10 to 15 years. The group was co-chaired by Chancellor of the Exchequer Alistair Darling and the former Chairman of Citigroup Inc., Sir Winfried Bichoff and comprised representatives of organisations from across the financial and related professional services industries. In the report, the Group attempts to demonstrate the value of the financial services industry to the UK economy and calls on the Government to enable the sector to be improved and strengthened in order to maximise its contribution. The report contains the following recommendations for action by the industry and the Government:
- To ensure that the UK continues to be an international financial centre through the maintenance of an open economy and by establishing a clear direction for the industry in partnership with the wider economy and overseas markets.
- For the UK’s reputation for trustworthiness to be reaffirmed by taking a leading role in the formulation and implementation of international regulation.
- To ensure strong engagement and productive dialogue between Government and the industry so that the UK’s financial capabilities are promoted, the tax system remains stable and competitive and flexible labour markets are supported with enhanced skills and training.
Full details here
Media, Technology and Cleantech Tipped to be Highest Growth Sectors
A survey of business leaders across 8 sectors has found that 43 per cent of those questioned expect the cleantech sector will grow at the fastest pace by 2020. Cleantech covers a wide range of products, processes and services that use new science to address the roots of ecological problems. The sectors of science and technology and of media and entertainment were also named in this survey as having high expectations of growth. Pollsters ICM conducted the online survey of 307 British business decision makers on the behalf of the Department for Business, Innovation and Skills which aims to raise awareness of the areas of greatest innovation and growth in order to drive investment and skills development. To increase this recognition further, the UK Government has recently launched the iawards that celebrate achievements in science, innovation and technology.
Full details here
| Digest Of Latest Data and Statistical Releases |
ONS – National and Regional Monthly Labour Market Statistics
The regional monthly Labour Market Statistics data tables are published by the Office for National Statistics (ONS) in the form of ‘zip’ files which then open up as separate regional excel spreadsheets.
Within those spreadsheets are data on employment; unemployment; economic activity and inactivity; and vacancy data. The regional data now includes information by local authorities, parliamentary constituencies and travel to work areas.
Latest official statistics show that the number of unemployed people, the unemployment rate and the claimant count have all increased. The unemployment rate was 7.9%, up 0.3 percentage points from the previous quarter, which equates to an increase of 88,000. Meanwhile the number of notified vacancies has remained unchanged on the previous quarter and stands at 434,000. Growth in average earnings, excluding bonuses, was down 0.3 percentage points and growth in average earnings, including bonuses, was down 0.2 percentage points.
All the data, including that at national level and from previous months, is all available via a single link, which can be found here
| Spotlight Feature |
The Intelligence briefing contains a topical “spotlight” feature, where we focus on a key issue relating to the work of the UK Commission for Employment and Skills and its partner organisations. This month we look at the Flexible New Deal. This new programme, which aims to find more effective ways to help long-term unemployed people into work, replaces the New Deal active labour market policies introduced by the UK Government in 1998.
The principles of FND
This month sees the Government’s introduction of the Flexible New Deal (FND). This programme will create a single New Deal programme to replace the New Deal for Young People (NDYP) and New Deal 25+ (ND25+). The new system aims to find more effective ways of helping long-term unemployed people into work.
The Department for Work and Pensions (DWP) has outlined five core principles of FND. These are:
- For customers claiming benefits to move from being passive recipients to active jobseekers through a strong framework of rights and responsibilities.
- Tailored employment and skills support to meet the needs of both customers and local employers provided by a personalised and responsive approach to individual customer needs.
- Public, private and third sector organisations working in partnership to maximise innovation, leading to more and better outcomes.
- Sustainable employment at the heart of neighbourhood renewal by empowering communities.
- An emphasis on sustaining and progressing in work to ensure all customers who need help to develop their skills have access to the relevant pre-employment and in-work training.
Particular emphasis is placed on the job entry performance of FND providers which comprise a small group of large prime contractors who are expected to sub-contract programme delivery to smaller, more specialist organisations. A new marketplace for welfare has been created where private and third sector brokers are paid by their results and have a larger role in the running of welfare-to-work schemes. Contracts will run for longer time periods and contractors will have greater autonomy in the programme’s implementation than before. The DWP has described this as a ‘black box’ approach to delivering employment programmes which means that providers will be able to design provision appropriate to their clients. For example, this may include job search advice, skills training or help with personal barriers to work.
There are 14 contract areas in Phase 1 of FND delivery which commenced earlier in October. 10 of these areas will have two prime contractors competing to deliver programmes with the other four to be led by single prime contractors. 18 further areas that make up Phase 2 will start FND delivery in October 2010, thus extending the programme across Great Britain1.
It should be noted, however, that the FND does not have cross-party support and Theresa May, Shadow Secretary of State for Work and Pensions, has indicated that if successful in the next election a Conservative government would not sign off the contracts for this second wave and would seek to replace the FND with a universal Work Programme.
The Government hopes that this approach will help to meet the unique and complex needs of the long-term unemployed by giving contractors both the incentives and flexibility to find what works best for each jobseeker. This ‘individualised’ support package would include components such as fortnightly contact with the customer; in-depth initial employment related needs assessments and the production of an action plan.
The idea of creating a managed welfare market for the delivery of employment programmes is one that appears to be supported across the mainstream British political spectrum. According to Dan Finn (2008) of the University of Portsmouth, who has conducted studies of the contracting out of welfare in the USA, Australia and the Netherlands, there is consensus that a welfare market will lead to service innovation and improvement as well as better job outcomes and value for money. The Government has made these claims in reference to ‘international best practice’.
Finn’s studies have found that supporters of similar programmes in other countries have claimed that private contractors have had a positive influence in terms of innovation, service delivery and efficiency. However, there have been concerns relating to the high costs of awarding and managing contracts. There have also been difficulties in the relationship between those who design policy and those who deliver front line services and suggestions that the conditions for effective competition have not truly been created.
The In addition, recent policy research and commentary suggest further challenges for FND in England associated with the economic downturn and programme flexibilities.
Targets and the downturn
FND has been conceived as a way of getting large numbers of long-term unemployed people into work in a growing economy. However, in the current economic climate of rising unemployment there is some concern that the strategy may need some revision. The House of Commons Work and Pensions Committee suggested in a report published earlier this year that the FND budget may not stretch to accommodate the additional customers generated by an economic downturn and also increased numbers of lone parents and disabled people claiming Jobseeker’s Allowance. The Committee’s consultation exercise included gathering evidence from 26 institutions representing the third sector, government departments, employment service providers, trade unions and non-governmental organisations. There were also visits to services in the UK and the Netherlands. Evidence was found indicating that the financial model for FND may be flawed and its targets possibly unrealistic.
Data analysis by Indus Delta - an online welfare-to-work news resource - shows that most of the various modules/routes through New Deal provision fail to achieve their job entry rate target, which is usually between 25 and 45 per cent. For example ‘Gateway to Work’, the two week full-time course taken by all participants at the beginning of New Deal had a job entry rate of 22 per cent between March 2008 and March 2009, but had a target of 45 percent. The DWP’s performance expectation for FND is for 55 per cent of referred clients to sustain a job for 13 weeks and 50 per cent for 26 weeks. With the old system clearly under-delivering, it is uncertain whether the new system can reach these apparently high targets.
The debate about flexibility
It is hoped that the payment by results approach of FND will provide sufficient incentives to make a significant difference. The potential side-effect of this approach is that it encourages the ‘creaming’ of easy to process clients to the detriment of those harder to help who get ‘parked’ because of the extra time and effort it takes to serve them successfully. The Work and Pensions Committee has stated that this is an issue which needs to be addressed urgently.
The competitive aspect of winning contracts from the Government to deliver FND arguably means that there will be greater emphasis on the performance of providers. However, it can be difficult to make concrete assessments of performance. For example, analysis of Government data on the performance of providers by Regeneration and Renewal found that the third sector had a higher rate of referrals into jobs than either the public or private sectors. In contrast, Indus Delta’s analysis found that the third sector trailed behind the other two. Furthemore, the greater freedom for providers to design their own service provision could lead to concerns about a ‘postcode’ lottery with people in different areas getting different levels of service.
Using evidence from previous evaluations of UK Government employment programmes, a report from the Social Market Foundation (Mulheirn et al., 2009) suggests that giving providers the flexibility to innovate and tailor interventions can be very effective if it is combined with a payment-by-results system. However, it is argued that under the new system flexibility is very limited due to FND only being available for those who have been unemployed for a year or more. Therefore, the Social Market Foundation has called for greater flexibility over the timing of interventions, arguing that FND should be brought forward to serve those who have been unemployed for 6 months. This is so that the benefits of the new system can contribute to preventing long-term unemployment as well as providing flexible support to those who are already long-term jobseekers.
1 Northern Ireland has a different welfare-to-work system, called Steps to Work
References
Finn, D. (2008) The Welfare Market and the Flexible New Deal: Lessons from Other Countries. University of Portsmouth, Portsmouth. Available: http://eprints.libr.port.ac.uk/archive/00000099/01/1_DF_LEPU_Article_31_10_08.pdf
House of Commons Work and Pensions Committee (2009) DWP’s Commissioning Strategy and the Flexible New Deal. Second Report of Session 2008-09, Volume I, HC59-I. The Stationery Office, London. Available: http://www.publications.parliament.uk/pa/cm200809/cmselect/cmworpen/59/9780215526656.pdf
Hoyle, G. (2009) ‘Time for a Re-think’, T Mag, March/April 2009, pp.22-23.
Mulheirn, I. and Menne, V. (2008) The Flexible New Deal: Making it Work. The Social Market Foundation, London. Available: http://www.smf.co.uk/assets/files/publications/SMF_Flexible_New_Deal.pdf
Mulheirn, I., et al. (2009) Vicious Cycles: Sustained Employment and Welfare Reform for the Next Decade. The Social Market Foundation, London. Available: http://www.smf.co.uk/assets/files/Vicious%20Cycles.pdf
'Intelligence’, the employment and skills research and policy e-bulletin, is produced in association with the Policy Research Institute at Leeds Metropolitan University.
