Evidence based blogging: a response
- a cut of £290 million to the Future Jobs Fund does not constitute a loss of 94,000 jobs, and;
- there is no evidence to support the proposition that “demand-led employment schemes are the most effective means to prevent long-term unemployment when vacancies are limited.”
As I set out below – she is wrong.
The Future Jobs Fund is, in the words of the DWP:
“a fund of around £1 billion to support the creation of jobs for long term unemployed young people and others who face significant disadvantage in the labour market.”
These jobs, which are funded at minimum wage for six-months, provide real employment for young people. They are intended to provide at least half a year’s worth of real work experience, as well as access to additional training and support to find permanent jobs on the open labour market. Importantly, these jobs have to be additional to existing employment opportunities, and must demonstrate that they provide social value – the scheme is designed to provide work for unemployed people without those already in work, or other unemployed people looking for jobs on the open labour market, being undercut. This is why there are few private sector positions.
There was going to be 205,000 jobs – now there are 111,000. Therefore, there are 94,000 fewer than before – these jobs have been lost.
As well as disagreeing with the DWP’s definition, Charlotte appears to disagree with the findings of Paul Gregg (described by Charlotte as ‘New Labour’s Go To Professor’ but also Senior Research Fellow at the LSE and Professor of Economics in the Centre for Market and Public Organisation at the University of Bristol) that, of the interventions available, a Job Guarantee is the best means to prevent long-term unemployment. But it is not just Paul Gregg who advocates (and he does, along with Professor Richard Layard, advocate) this approach.
In a recently published evidence review, DWP concluded (against the Government’s policies at the time – which were moving towards a workfare approach) that:
The success of these subsidised job programmes compares
well with the less favourable outcomes for conventional workfare programmes
The Brookings Institute – widely seen as an independent and authoritative source – also conclude that employment outcomes from subsidised job programmes are better than those from other employment programmes, describing transitional jobs as:
an especially promising policy response to the needs of hard-pressed urban and rural communities, and unemployed people facing barriers to work.
And the UK Commission on Employment and Skills has recently concluded that:
“In terms of getting into work, subsidised jobs have proved to be the most successful approach and more successful than education and training.”
Last year, The Work Foundation, The Resolution Foundation and Demos worked with the TUC to support Job Guarantee policies.
No one has ever claimed that a welfare to work programme can eliminate unemployment – but, although not everyone chooses to acknowledge it, the evidence does show that subsidised employment programmes can significantly improve unemployed people’s chances of remaining in touch with the labour market and moving back into work. When demand is limited, there is no evidence of another approach more successfully reducing long-term unemployment.
There are over 90,000 young unemployed people in the UK today. Doing nothing is not an option, and cutting support for them is wrong – as David Blanchflower wrote this weekend:
“These are your kids and grandkids. Stand up and say no.”