A London response to the jobs crisis: principles for employment support

A London response to the jobs crisis: principles for employment support

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Our response to the growing jobs crisis must meet the needs of Londoners and the London economy. The government’s Plan for Jobs is a welcome start, but the measures need to go further to meet the challenges faced by central London’s labour market and economy throughout the crisis. Our last blog from Tony Wilson from the IES set out the significant challenges central London faces – here I will set out why it’s vital that central and local government work together for a response that works for all Londoners.

Urgent action is needed –  the OBR predicts that 15% of workers on furlough will not get their jobs back (equalling 62,805 central London residents) after the Job Retention Scheme ends in October, and unemployment is set to rise by a further staggering 12% by the end of 2020. Central London, with its reduction in office workforce, interdependency between office workers and neighbouring retail & hospitality businesses, and halt on tourism, is now seeing numerous organisations cutting jobs over the summer. It is crucial that the right employment support is in place to combat this forecast second spike in employment in the Autumn. Government must embrace the principle of subsidiarity and localise employment support where it can – taking a national or generic approach risks failing to take in to account significant regional variation in both labour markets and public health impacts of COVID-19.

Local authorities have been at the heart of the community response to the national crisis. They have taken the lead on carrying out many government schemes, developed and delivered services for local businesses, worked with the voluntary sector and identified and supported residents in need. This is on top of continuing and adapting existing services to respond to the health and resulting economic crisis with reduced resources and limited capacity. This has evidenced boroughs’ ability to be agile and responsive in the face of unprecedented pressure.

Boroughs are ready to use this experience and expertise to focus on protecting, preparing and supporting our residents to face what has now been confirmed as the worst recession our country has faced since the invention of GDP (ONS). Building on this deeper community working and understanding of local area need, a borough-led approach to employment support creates greater focused and targeted support to those groups most affected in their area, allowing for greater variation borough to borough.

Economic crises can lead to long-term scarring in terms of employment, skills and progression. It is crucial that employment support works for everyone, to ensure that no Londoner gets left behind. This includes young people, BAME communities and women, and people who have complex significant barriers to work, including disabled people and people who are homeless or living in temporary accommodation. Using local government expertise, building on learnings from Central London Works: Work & Health Programme, to deliver personalised support and access to training and skills, councils can support those most impacted and furthest from the labour market, who will likely be in competition for jobs with newly unemployed individuals considered more ‘job ready’.

To ensure a cohesive offer of support, the swathe of new measures introduced in the Plan for Jobs should be integrated or aligned with existing London government services.

Residents requiring support should be triaged based on their level of need and eligibility to ensure they receive the most appropriate support, reducing the risk of a bottle neck in new provision. This can connect people to existing careers and IAG services, training providers, and skills pathways.

Accessing support should be based on need, not benefit type – employment support should be decoupled from the benefit system, with eligibility based on a desire to work and referrals to specialist support possible outside of the Jobcentre Plus structure. A good place to start would be greater coordination and collective action between local authorities and Jobcentres to identify the barriers to sustainable employment people face. Co-locating more employment and local authority services where we can, would be a fantastic place to start this – not only would it be helpful in terms of social distancing and capacity but also help to align skills and resources.

A national approach to job entry schemes also risks focusing overly much on large national companies – a key part of the system yes, but not the full picture. Building on the closer partnership working boroughs have undertaken with local businesses throughout COVID-19, this provides an opportunity to boost job brokerage and matching services. Learning from previous recessions, where employment creation resulted in increases in  part-time, insecure or precarious employment (UKCES, 2014), employment support must prioritise enabling people to access sustainable, high quality jobs. Local authorities can continue to work with local businesses, identifying meaningful employment opportunities to connect residents with, and work with growth sectors to create additional employments. This will not only provide a seamless transition for employment programme participants into jobs but help to grow and regenerate local economies.

Boroughs are already taking steps at a council level, sub-regionally and across the capital to support residents to face a difficult labour market. With more than 60% of London businesses expected to make further redundancies (City AM), and unemployment set to reach levels not seen in decades, it is time for us to work together with central government to create a new system of employment support that makes sense in this ‘new normal’.

Efa Gough, 14th August 2020