Last week the Government launched a new flagship Work Programme which it hopes will help ease unemployment issues and skill shortages. This replaced the previous programme which primarily engaged private subcontractors to help the longer term unemployed back to work. The new system shifts the focus by incentivising the subcontractors for placing someone in a ‘sustainable’ role. It is hoped that the ‘payment by results’ model, in essence not that dissimilar to the one that the contingency recruitment industry operates, will be more effective.
But will it work?
There have been some critics, primarily worried that the businesses delivering the service will focus on the people and areas where it will be easier to make longer term placements. The ‘reward by results’ approach has been successful in the private recruitment sector, but does it always deliver the best results or experience to those who cannot easily be matched to vacancies?
Neil Lee, senior economist at Work Foundation said ‘as the Work Programme is based on payment by results, contractors carry the initial risk. There is therefore the danger that private contractors will focus on investing in places where they are more likely to get people into work to secure a return on investment’
Writing in the Daily Telegraph, Jobs editor Louisa Peacock raises the fact that ‘Just one prime contractor delivering the Government’s flagship Work Programme is completely new to the welfare-to-work market’ questioning that if the others were unable to make previous schemes work, why should this new one be more successful. She also comments on the timeframes ‘we won’t know for sure whether the Work Programme is working until after at least two years as they will only get paid the full amount once their candidate has been in sustained employment for 24 months’.
Respected HR blog Change-Effect argued ‘There is no genuine, long-lasting value behind “job creation” schemes or incentives, they don’t lead to a step change in the labour market’ and called for ‘investment in the key market sectors that Britain can be strong in…invest in the knowledge economy, in creative industries, in R&D.’
As the CBI said in their latest report ‘The answer is not bussing people to where the jobs are. We need to tackle the structural causes of unemployment’ – to have real, long term impact the new scheme needs to operate in tandem with a commitment to investment, re-training and growth in the sectors which will provide sustainable employment opportunities in the future.
It probably didn’t help the Minister who launched the new programme described it as ‘a giant employment dating agency’.
We’re keen to get the views of our clients and jobseekers. We know how crucial it is to get the employment market moving again so want to find out how you feel about the new scheme.
If you are a hiring company do you think this scheme will help give you access to the talent that you need?
If you’re a jobseeker who qualifies for help under this scheme, do you think that the shift in emphasis will help your search?
Let us know what you think.
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