Active Labour Market Policy in a Post-Covid UK: Moving Beyond a ‘Work First’ Approach

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On the 21st of April, City-REDI in conjunction with the Social Policy Association’s Employment Policy in Context policy group presented a webinar featuring Dr Katy Jones from the Centre for Decent Work and Productivity at Manchester Metropolitan University.

The seminar, which explored “Active labour market policy in a post-Covid UK: Moving Beyond a ‘Work First’ Approach”, drew on Dr Jones’ recent chapter in ‘Productivity and the Pandemic. Challenges and Insights from Covid-19edited by Professors Philip McCann and Tim Vorley.

Abstract

The UK faces unprecedented levels of un- and underemployment as a result of the Covid-19 pandemic, and active labour market policy will be a key part of the response.

However, to date, the UK’s approach to active labour market policy (ALMP) has been overwhelmingly supply-side focused, underpinned by a ‘work first’ approach that encourages fast work entry rather than work quality. Research and policy have neglected to consider the implications of this for productivity, although some researchers have begun to draw links between the UK’s poor productivity performance, its ‘long tail’ of low paid and insecure work and a welfare system that curtails the choice and bargaining power of unemployed and low-income workers (Innes, 2018; Briken and Taylor, 2018; Rubery et al. 2018). Following a critique of the existing ‘work first’ approach, Katy will argue for a more ‘productive’ approach to UK ALMP in a post-Covid UK, placing more emphasis on employment quality, well-being and skills.

Summary of the Event
  • Universal Credit – the main benefit for those who are unemployed/on a low income – is underpinned by a ‘Work First’ approach. For out-of-work claimants, this involves a focus on fast entry into work, based around 25 hours a week of job search, support with job search from a Work Coach and sanctions for those not meeting requirements. For in-work claimants, there is a lack of clarity but workers on a low income who are in receipt of Universal Credit may be expected to increase their hours, look for ways to progress in their current workplace, search for additional work with a different employer (i.e. take on multiple jobs) or take up alternative work elsewhere (i.e. move jobs).
  • The number of Universal Credit claimants increased rapidly due to the Covid-19 pandemic, rising from 1.5 million in December 2018 to over 5 million in July 2020.
  • Three key productivity-related issues are important when considering Universal Credit, decent work and productivity: employment quality, well-being and skills.
  • UK ALMP/welfare reform over recent years has developed in isolation from wider debates relating to ‘good work’ (BEIS, 2017; Taylor, 2017)
  • The recently launched Kickstart scheme acknowledges the need for participants to be undertaking ‘decent’ work but questions exist over what this means in practice. Some sub-national schemes are designed to ensure that placements align to ‘good work’.
  • Well-being is increasingly included in debates about productivity. However, the nature of work is key with under-employment and insecure work, for example, impacting negatively on worker well-being. A positive association exists between life satisfaction and productivity. The Welfare Conditionality Project has found that welfare conditionality including sanctions can have a negative impact on the health and well-being of social security claimants. ‘In-work conditionality’ under Universal Credit risks exacerbating the already poor well-being of insecure workers (Jones, 2019).
  • Investing in skills has been shown to create significant economic and social benefits. Many developed nations have focused on education and training as part of ALMP. However, the ‘Work First’ agenda adopted in the UK has led to the sidelining of human capital development approaches involving investment in skills and personal development. A narrow range of training options has often been a feature of UK ALMP.
  • Dr Katy Jones argued that a mismatch can be identified between the ‘work first, then work more’ approach of the Department for Work and Pensions (DWP) and the lifelong learning and Industrial Strategy/good work agendas of the Department for Education (DfE) and the Department for Business, Energy and Industrial Strategy (BEIS).
  • The discussion then explored how the ‘Work First’ approach adopted in ‘normal times’ prior to the start of the pandemic can be considered “unproductive” as it ignored long-standing issues of poor work quality and management practices, and people’s needs outside the paid labour market. Policymakers could have placed greater emphasis on supporting individuals (where appropriate) to move into decent and more productive work and/or quality training opportunities.
  • Crisis and recovery needs emphasise the importance of policy being broader than a supply-side only approach.
  • Possible national policy solutions include:
    1. support-based rather than sanctions-based, well-resourced, and well-targeted ALMP;
    2. developing links between ALMP and the wider skills system to provide pathways into education and training;
    3. moving towards a joint strategy between the DWP, BEIS and the DfE in England to better link ALMP to broader economic strategies focused on inclusive growth and improving job quality;
    4. greater emphasis on job quality and better job matching at work entry;
    5. greater focus on in-work support designed to improve pay/progression;
    6. ensuring that recent shifts in emphasis (for example in relation to in-work progression consultation/and the focus on ‘decent work’ within Kickstart) translate into policies, practices and measurement on the ground;
    7. greater emphasis on developing policy through consulting with claimants, employers, unions and other ‘social partners’.
  • In terms of local policy solutions, the presentation examined the importance of DWP and Jobcentre Plus changing their focus to:
    1. engage more meaningfully in how local industrial strategies (and their successor documents) are developed, and seeking to better align ALMP with the broader skills and work ecosystem;
    2. develop links with employers with good quality jobs;
    3. be more active in wider efforts to promote good work within local business communities.
  • Katy will examine the demand-side of ALMP in her new ESRC 2 year research project exploring how ALMP is understood and experienced by UK employers, how it impacts how businesses are run, and how employment services can work more effectively with employers.

Date Speaker Organisation Seminar title Book a place
19th May Dr Levi Wolf University of Bristol, UK Space and place in predictive models Book a place
2nd June Dr Rhiannon Pugh CIRCLE, Lund University, Sweden The changing roles of universities during the Covid crisis Book a place
16th June Beatriz Jambrina Canseco, PhD LSE, UK The stories we tell ourselves: Local newspaper reporting and support for the radical right Book a place

This blog was written by Dr Abigail Taylor, City-REDI  / WM REDI, University of Birmingham.

Disclaimer: 
The views expressed in this analysis post are those of the authors and not necessarily those of City-REDI or the University of Birmingham.

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