Saturday, February 25, 2012

Workfare - neither work nor fair?

Workfare has been to the fore lately, with the big participants in the 'work experience' schemes dropping out like flies. Sadly, the government has continued its own work experience scheme by finding employment for functional idiots (pictured).

 Being serious, these schemes help to distort the employment market - why should a large and highly profitable employer be able to benefit from an unending pool of essentially free labour? Tories should surely be concerned about what is government aid to a private business, but we know that their loathing of the private sector doesn't extend to companies that seek to bury their noses in the taxpayer trough.

There may be a slightly different case where there is proper training being provided, where the employer has invested something of their own time and money into the work experience trainee, but the other key problem is that it undermines the concept of the minimum wage and creates a minimum wage level that equates to JSA, something around £1.80 an hour for the 30 hour week offered. Tesco have now extended their offer by promising to pay participants the minimum wage and a suitable middle ground might be for the government to pay the employer the JSA rates to subsidise this employment - although that does raise the spectre of direct government support.

This sort of scheme does soothe the fevered brow of the Daily Mail, worried that there are scores of scroungers lazing around watching Jeremy Kyle and playing on their XBoxes rather than being out there, contributing to society. Morally, there is also the issue of using what is essentially conscripted labour - there is anecdotal evidence that people are being pressured onto these schemes and for some groups, the work is mandatory. However, the real question should be - does it actually make a difference? It might be possible to justify a brief period of work experience if it led to a proper job, but the evidence is inconclusive at best.

Cait Reilly - the young graduate memorably described by Cristina Odone as a 'creature' on BBC Question Time this week - reported on her experience in Poundland thatShe was actually dragged off a 'work placement' she had organised herself with a museum - something relevant to the career she hoped to pursue (and that's something that would score highly with me on initiative as a recruiter). Why the JobCentre couldn't have been a little imaginative with their thinking says much about the tramlines on which that service is run - I've long held the view that it is not being managed to deliver the best outcomes.
"No one really knew what we were supposed to be doing. We were just put on the shop floor and told to tidy shelves"
James Rayburn worked in Tesco

"I didn't actually have much support …They were getting on with their own jobs … they left me to it... They said, 'Good work today, Joe'. That was it, everyday
In terms of proper, academic analysis, there is limited data and, as Factcheck points out, (HT to @bengoldacre) the evidence so far - on a small base, to be fair - is inconclusive at best. The graph indicates the number of JSA claimants and work experience participants who remain on JSA as the weeks progress. It is very important to remember that coming off JSA does not mean that the claimant has found a job - about two thirds of those who leave JSA do so for work, but some of them enter education and others even end up submitting a new JSA claim, so restarting the process. 

Indeed, given that you would expect that candidates for this scheme to be those who are likely to have something about them and are likely to be able to turn up for work and not wind up their work experience employer, these may well be people more likely to gain employment than those not put forward for the scheme. These are not likely to be the hard cases, despite the rhetoric from the DWP.

Inclusion comment on their graph
This appears to show that the youth work experience scheme has had no additional impact on the speed at which young people leave benefit, and may have actually led to them spending longer on benefit than they would have done.  However, these figures require some caution  – the stated intent of the Department has been to target work experience at those with the biggest barriers to work, who would likely have had off-flow rates below the average for all claimants
currently work experience placements are too often short, of poor quality, with young people given little to do and the placement poorly linked to their wider education or the advice and guidance they receive
As someone with considerable experience of recruiting people, I'm not convinced that a short work placement would do any more than tip the balance slightly in favour of that candidate compared to somebody with no work experience, but it would not compensate for the experience gained by a candidate who had actually held a job for some time - hence why unemployment is significantly higher amongst the 16-24 group. Employers aren't daft. It would be of interest to me to have somebody on what amounts to a probationary period, so from that point of view, there is an attraction in being involved in the scheme, but I'm doubtful that it significantly increases the status of candidates in the eyes of others. The schemes also need to have actual value - stacking shelves in Poundland is of limited use outside the retail or warehousing sectors. Jonathan Portes refers to the ACEVO Commission on Youth Unemployment
If that is the case, then these placements are essentially without value to future employers and may even demoralise those taking part, rather than building their confidence to go and get a job. 
 The DWP already has evidence of the effectiveness of workfare - they commissioned a report  which analysed schemes in the US, Australia and Canada and came to the following conclusions (HT to @Right_to_work )
  • There is little evidence that workfare increases the likelihood of finding work. It can even reduce employment chances by limiting the time available for job search and by failing to provide the skills and experience valued by employers.
  • Subsidised (‘transitional’) job schemes that pay a wage can be more effective in raising employment levels than ‘work for benefit’ programmes.
  • Workfare is least effective in getting people into jobs in weak labour markets where unemployment is high.
  • Levels of non-participation in mandatory activities are high in some workfare programmes
  • Workfare is least effective for individuals with multiple barriers to work.
  • Welfare recipients with multiple barriers often find it difficult to meet obligations to take part in unpaid work. This can lead to sanctions and, in the most extreme cases, the complete withdrawal of benefits that leaves some individuals with no work and no income. 
  • Some states in the US have scaled down large-scale, universal workfare programmes in preference for ‘softer’ and more flexible models that offer greater support to those with the most barriers to work. This includes a greater reliance on subsidised jobs that pay wages rather than benefits to participants
I should point out that I am no "job snob." I started my working life in retail, working part time in a computer retailer and worked up to be branch manager, so there are real opportunities there for those who want them - we have always been a nation of shopkeepers. I'm also firmly of the belief that there is a moral duty for people to work and to contribute to society - it is good for them and their families. I've never been out of work for more than a few weeks since I left university and I've not been too proud to take jobs on lower pay rather than hang on for the right job that pays brilliant money. This is a very personal problem for me - my contract finishes at the end of March and I will then have to rely on our savings and the very limited state support available to keep our heads bobbing above water. I will be honest with you and say that the prospect terrifies me - it keeps me awake at night.

The real problem isn't that we have a nation of scroungers - we don't, although of course, there will be some who are unwilling to work, but they are a very small number. The real problem is that there just aren't enough jobs. In Leicester, for example, Tesco saw 17 people applying for each position at one of their Express sites, while the opening of a larger Metro store last year brought 26 applicants for every job. People travelled from Sheffield and Birmingham to a jobs fair in the wilds of Lincolnshire. Travelodge had 66 applicants for every place on one of their junior management apprentice schemes. Hull has 80 JSA claimants for every JobCentre vacancy, Stoke has 73, Sunderland, Southend and The Wirral all count over 40 people for every available job. Over in Wales, it is normal to see 10 applicants for every job. Trust me on this - as someone looking for a job right now - it is a very tough market out there.

As the DWP know - workfare won't make any substantial difference to you if there isn't a job you can apply for. All of this really goes to the core of the issue - jobs will only come from economic growth and if the government is not delivering on that agenda, then they are failing our young people and the whole country on a grand scale. Trying to marginalise opposition to the current incarnation of workfare by blaming it on the Trots and throwing around wild accusations of email hacking ignores the reality that there are genuine concerns about the efficacy of these schemes as well as their moral and economic impacts and that these worries are shared by a broad range of groups, not just the bandwagon-friendly, simplistic, rabble rousers of the SWP (of whom I am assuredly not one, although I am a socialist, currently a worker and not averse to a good party). Grayling on the Today programme yesterday was sounding desperate, as well he might. Yet another government scheme is falling to pieces around their ears and no amount of sticking plaster, right-wing, feel-superior policies conceal that the government has no plan and no direction on the single biggest issue of the day.

It's the economy, stupid.

This is also the worst place to put a 'Situations Wanted' ad, but if you think you can use a generalist operations or service manager with broad commercial experience, you know how to find me. All offers considered and confidentiality assured.


Anonymous said...

I agree wholeheartedly, but you need to sort out the format :-). It puts you off reading it, which is a shame as you make some excellent points.

John O'Shea said...

Sorry about that - Blogger took it upon itself to reorder paragraphs and italicise things on a random basis. It has done that once or twice lately.