Innovation and the Work Programme Stephen Evans Business Development Director

Working Links: About us Established in 2000 to support unemployed and disadvantaged individuals into lasting employment. Unique mix of government, private and voluntary sector ownership. To date, we’ve worked with over 15,000 employers and helped more than 230,000 people back into work.

Our delivery: Britain Work Programme expected flows: Scotland – 107,000 Wales – 66,000 South West – 36,000

Labour market: key challenges… Economic growth Productivity (+2.2pp) Average hours (-0.2pp) Employment rate (-0.2pp) Population growth (+0.5pp) Living standards Hourly wages Hours worked Employment Transfers Three challenges around: economic growth, living standards and the public finances Economic growth: Four key drivers: 1) Productivity – amount produced per worker per hour. Governments have been trying to boost this for a long time. 2) Average hours – long term downward trend, desirable to increase? 3) Employment rate – downward trend due to demographics (ie growth in age cohorts less likely to work) but employment policy can help to ameliorate. 4) Population growth – natural and migration. Living standards: Also four drivers: 1) Hourly wages – economic theory says a direct link with productivity, but this seems to have broken at bottom end in recent decade or so (wages at top have raced away, stagnant at bottom – ie 10% growth in economy but no increase in median wages). 2) Hours worked – higher levels concentrated at top, but question desirability of increasing in aggregate anyway. 3) Employment – tough conditions at present time and employment has become polarised into work rich and work poor households.4) Transfers – Significant tax and benefit transfers appear to have reached the limits of acceptability. All of which means that growth is slower and does not necessarily lead through to improved living standards for people. Public finances: 1) Lower economic growth = lower tax revenue. 2) Demography – aging population means increased budgets for health, pensions and social care. Shift seen over last 30 years likely to continue. All of which means we have less public money to ‘fix’ these challenges. Public finances Economic growth Demography

…have profound implications… ‘Secure’ employment with prospects C.4m Entrenched low pay The implications of this are a continuation of entrenched worklessness. 1/3 of those out of work have been out of work for more than 2 years. And entrenched low pay – the eating away of intermediate jobs as progression routes and decoupling of wages and productivity at the lower end of the labour market mean c.4m people in work below the poverty line. More people in in work poverty than out of work poverty. And cycling between the two. C.4m Entrenched worklessness

…with tough policy challenges Support those excluded from the labour market back in touch Rebuild link between work and reward Do this in toughest economic and fiscal context for 60 years+

What’s this got to do with the Work Programme? 1) Work Programme will not succeed unless providers can engage those out of labour market for many years 2) Work Programme will not succeed without a different partnership model with employers for jobs and progression 3) Work Programme offers opportunity to try new approaches to joining up support – hitting multiple policy outcomes

Working Links’ approach Delivering and innovating

Customer journey Referral From Jobcentre Plus Invitation letter Induction session Assessment My Way Up: Employability Lifestyle Goals Skills Health Attitudes Into work support Dedicated Personal Adviser Flexible support (such as CV, jobsearch, work experience, training, health, coaching) c.300,000 customers across 3 CPA’s over contract lifetime. In work support Dedicated In-Work Support Adviser Flexible support Help to find next job and build career

Opportunities for innovation How to make best use of Universal Credit? How best to integrate services locally? Cross cutting: Referral Use of behavioural economics approach to engagement? Assessment Do our tools allow a finer assessment of who is most likely to succeed? Into work support Does integration of other support (like skills, money management, enterprise) improve outcomes? In work support How do we work with employers and customers to improve progression?

Innovation in practice Enterprise - Wales. New approach to self-employment has doubled proportion of customers starting their own business. Plan to roll out further across wales - South west. Integration of enterprise coaching scheme with work programme to build up expertise in WP advisers. Already helped 80+ people start their own businesses Motivation - Wales. Trialling number of different approaches to boosting motivation and attitude among those furthest from the labour market. Scale of WP gives opportunity to measure impact, for example of completers of one scheme (using a diagnostic tool to measure progress on confidence, resiliance and so on) c.37% have found work, higher than for other similar groups Wales. Innovative because data from My Way Up showed higher interest in self employment so we increased provision. Also because it involves using a different approach based on a proposal brought to us. Enterprise increasingly important given economic circumstances – create own jobs

Next steps Stephen.Evans@workinglinks.co.uk Contact details Measuring impact of innovation already underway, eg retention in work later this year Working up further pilots for year ahead Open to new ideas, both in WL Work Programme areas and beyond, so please get in touch Contact details Stephen.Evans@workinglinks.co.uk