The long term unemployed do face additional hurdles in obtaining a job so the idea of additional support to help them into employment isn’t such a bad idea. By “support” I mean a genuine effort involved in training and guidance that reflects the needs of the person and the requirements of the local job market. I do not mean “support” in the sense presently used by the DWP and it’s Work Programme type schemes, as the word has simply become a euphemism for cutting the welfare budget and distracting people away from the economic problems by scapegoating unemployed through forced labour and sanctions. (see Work Programme and the Need for Common Sense)
If there were more vacancies compared to the number unemployed then certainly there is a good case for retraining schemes that matches people to the available jobs.
Lets imagine you are the head of the DWP in January of last year and your having a second look at the case for spending tax payers money in back to work schemes in an Q&A sessions with an advisor:
Q1) What is the ratio of vacancies to unemployed in the UK? If the ratio is less than 1 then it seems the proposed expenditure would be better spent on economic regeneration rather trying to push people into jobs that don’t actually exist.
A1) As of January 2012 the ration is 0.17. There are nearly 6 unemployed people for every vacancy on average throughout the UK.
Q2) Since it seems a National Work Programme is non-runner (why spend money on a national WP when there isn’t even remotely enough jobs) can we justify regional Work Programmes?
A2) An analysis of the average vacancies/job ratios taken over 207 towns and regions shows that there is 8 unemployed people for each job on region by region basis.
Q3) But surely out of the 207 areas there has to be some where there is more vacancies than unemployed people.?
A3) There is only one area that meets your criteria - The City of London where the ratio is 0.3. There is 111 claimants for 433 jobs in the City.
Q4) Can you give me one single reason why we should set up a National Work Programme to deal with 111 claimants in London?
A4) No, minister.
Q5) Then why are we spending all this money on a National Work Programme when it’s of no worth whatsoever at the macro economic level. If there is vastly more claimants than jobs, what is the point?
A5) It does create some jobs in the offices of Work Programme contractors.
Q6) So we are giving hundreds of millions of pounds to companies who do nothing in the way of creating jobs but simply waste time pushing people around pretending they can get them into a jobs?
A6) The preliminary data we have regarding the success rate of Work Programme contractors strongly indicates that it would be better leaving claimants alone as they have better success in getting a job compared to placing them in the hands of the contractors we are paying, thats why the targets we gave contractors were set at a level of return that no commercial company in the real world would have even thought worthy of consideration if they wished to stay in business.
Q7) So basically we are wasting millions for nothing. Can’t we get claimants doing work in job placements?
A7) Common sense indicates that companies rely on free labour supplied by us to increase profit margins and therefore it creates unemployment since they no longer need as much in the way of paid employees.
Q8) Why on earth did we ever get involved in this kind of Workfare scheme as it seems to be horribly flawed in principle?
A8) The research we carried out under your predecessor showed that the schemes didn’t do what they were supposed to do in other countries that have tried it. The report asserted “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.” The decision to introduce the Work Programme was done for political and not economic reasons. You have to consult with your colleagues regarding the perceived political advantages.
