Article by ResPublica's Caroline Macfarland featured as this month's Total Politics' The Idea
The recent ONS figures on unemployment present, at face
value, a positive picture for economic growth. However, the rise in employment
was largely boosted by youth unemployment figures, whereas the number of
long-term claimants has stagnated. The Work Programme continues to be condemned
for not delivering on its objectives, a key part of which was to address
sustained worklessless and pockets of intergenerational dependency.
Widespread and fierce critique of the Work Programme has
highlighted a model which restricts competition, resulting in a closed market
and limiting new entrants. With price competition and payment-by-results as
supposed key motivating factors, these have in fact has resulted in risk
adversity, in particular for smaller charities and grassroots organisations,
and short-termist solutions for low value jobs rather than upwards mobility.
All of which result in little or no innovation amongst providers, and acute
implications for the regeneration of localities with unstable workforces and
deep pockets of long-term unemployment.
This is a problem that could be addressed by marrying the
work programme with another flagship agenda of this government: localism. To
date, localism and employment discussions have seen the answer as skills
matching: training the local population to meet the needs of local businesses.
But on the other side of the coin, a localist approach could also involve
pruning local economies to match the skills of the communities they serve. There
needs to be a greater level of connectedness between the regeneration agenda,
and the value of local labour markets.
Beyond the short-sighted view of economic growth in terms of
GDP, a more holistic picture conceptualises a recovery which co-creates opportunity
in local communities. Many of the attempts to stimulate local growth, whether
in terms of regeneration or local employment, have been top-down initiatives
which sideline human aspiration and the needs of neighbourhoods from the
Innovation and truly responsive measures to address
unemployment are currently inhibited by a presumption in favour of economies of
scale (ie. the larger welfare-to-work providers) rather than economies of flow. Experts have pointed
out that having financial incentives in place does not necessarily mean that
there is a corresponding framework for innovation to take place. Such a
framework instead requires responsiveness
to be built into the system – that is room for local knowledge and local labour
market knowledge. A responsive work programme would promote dialogue and reciprocity
with both service providers and local employers, and local contractors having
the autonomy to lead by example.
Housing associations, for example, already play this role in
the context of other services, acting as a locus for public, private and neighbourhood
groups to capitalise on available resources. Housing associations are able to promote and
deliver collective social value to a community beyond the provisions of a
contract, both in terms of housing-related and non-housing services in places
where landlords have concentrated stock. They are in a prime position to facilitate
a socially beneficial economy on a neighbourhood basis, in their own operations
and supply chains, and acting as incubators and guarantors for other
initiatives. Beyond being service providers, housing associations have their
own space and assets which could be used as hubs to catalyse economic activity.
What is needed is a recalibration of the labour market at the
bottom end. Localism is based on applying local knowledge to local problems,
the specificities of which will naturally vary from place to place. There is
vastly untapped potential for localised employment services which capitalise on
– often unrecognised or intangible – local assets such as community networks
and support structures.
The introduction of Universal Credit marks an opportunity
for the separation of Jobcentre Plus benefit agency and employment service
functions. Local control of the employment services side could capitalise on
available resources and provide a real ‘matching’ service. This could result in
inter-agency partnerships between training and skills providers, social
landlords, local businesses and voluntary organisations for example. It could
be facilitated through extending the community right to challenge to employment
services. As neighbourhood and community organisations are increasingly given
responsibility for the management and delivery of local services, it makes
sense that they could also be responsible of shaping these services depending
on labour supply, skills, and training requirements.
In addition, evaluating success must be based on an
understanding of purpose rather than solely outcomes. This may require a
radical redesign of the concept of work itself, based on local labour markets,
demographic changes and work readiness of the people themselves. It may be that
local intermediaries would define certain types of voluntary work as a valid contribution
to local economies and therefore seek to redefine the traditional, nationally
imposed jobseeking requirements which prioritise more narrow conceptions of
skills training. Proposals for schemes such as the ‘Community Allowance’ would
allow benefit claimants to be paid to do short term intermediate local work
placements to improve more general community wellbeing, without affecting their
benefits. This would protect their welfare security, improve skills and work
experience, and encourage the recognition of all contributors to local
economies whether on a formal or ‘softer’ basis.
Addressing entrenched problems of worklessness, particularly
when relative to geographical pockets of deprivation, requires local knowledge
of both economic and social prerogatives, and adaptation to individual
circumstances rather than standardised solutions. A localised Work Programme could
achieve innovation amidst austerity for responsible recovery which benefits
those currently excluded from the labour market.
This article was originally published in Total Politics.