Chancellor Rishi Sunak has pledged billions of funding in today’s Spending Review to help the hundreds of thousands of people who have lost their jobs because of the pandemic back into work.
The package of investment includes £2.9bn for the Department for Work and Pensions to launch a new ‘Restart’ scheme to help one million people find employment through training courses and local partnerships.
Restarting the economy
The three-year scheme will be open to people who have been out of work for more than 12 months, and will provide them with regular intensive support in finding work. It will be aimed at older workers in particular.
On top of Restart, the Treasury will provide a further £1.4bn to increase the capacity of Jobcentre Plus, which is already undergoing a recruitment drive.
The Treasury’s Spending Review document revealed that £2bn will be invested in the Kickstart Scheme to create hundreds of thousands of new, fully subsidised jobs for young people. In 2020-21, £1.6bn will be made available for 250,000 placements.
Some £2.5bn is to be invested in apprenticeships and making the system work better for employers. This will include the ability for employers to transfer unused apprenticeship levy funds in bulk to SMEs from August 2021; the testing of approaches to supporting apprenticeships in industries with more flexible working patterns, including consideration of how best to support apprenticeship training agencies; and extending incentive payments to firms hiring new apprentices until 31 March 2021.
The government will also allocate £200m for other job search support measures announced in the Plan for Jobs
in the summer, including the Job Entry: Targeted Support and Job Finding Support schemes, the Youth Offer and Sector-based Work Academy Programme placements.
Cannot protect every job
However, Sunak noted that the government could not protect every job and said the Office for Budget Responsibility expected unemployment to reach 7.5% in the second quarter of next year, falling to 4.4% by the end of 2024.
Speaking in the House of Commons, Sunak said the government was taking “extraordinary measures to protect jobs and incomes”.
“My number one priority is to protect jobs and livelihoods across the UK,” he said.
“This Spending Review will ensure hundreds of thousands of jobs are supported and protected in the acute phase of this crisis and beyond with a multi-billion package of investment to ensure that no-one is left without hope or opportunity.”
He is also told MPs that tens of billions of government spending on infrastructure projects, which will be allocated by an ‘Infrastructure Bank’ headquartered in the North of England, will create and protect hundreds of thousands of jobs across the UK.
Quick action needed
Neil Carberry, chief executive of the Recruitment & Employment Confederation (REC), said action to support people back into work needed to be taken quickly. “Supporting people back into work is a highly specialised task and the UK’s recruitment industry are the jobs experts that can get this done.
“We’re already working with government to support businesses and workers in navigating the recovery, including through the Kickstart scheme which the REC is facilitating to get more workers into the employment industry. A close partnership with government to ensure jobseekers can access the expertise of professional recruiters through Job Centres will allow the Restart scheme to make a big difference.”
A close partnership with government to ensure jobseekers can access the expertise of professional recruiters through Job Centres will allow the Restart scheme to make a big difference” – Neil Carberry, REC
He added that the apprenticeship levy needs to work better for businesses. “The levy must be broadened so temporary workers can access high-quality, shorter training courses – the kind that are needed now to help people transition into growing industries and support the government’s ambitions for regional infrastructure. Local recruiters who know the labour market will be essential to these plans,” said Carberry.
Also reacting to the apprenticeship levy changes, Karen Jones, HR director at construction firm Redrow, said: “To date, SMEs have faced huge barriers to employer apprenticeships. For SME hiring managers not employing apprentices, the most popular reason given for their decision is lack of funding, which was cited by 29% of respondents as preventing them from taking on apprentices. For SMEs operating in the construction sector specifically this rose to more than a third (38%) and was once again the most frequently cited barrier. Today’s announcement should play a role in alleviating these pressures.”
‘On the right track’
Simon Lyle, UK MD of outplacement firm Randstad Risesmart said: “With his Restart Scheme and the plan to find work for people without jobs, Rishi Sunak is on the right track. Intensive support, tailored to people’s circumstances is exactly what we’d recommend a private sector client give employees who had been laid-off.
“It works : 83% of people who we find a new job for, get work paying the same or more than they were earning before they were made redundant. While it’s a tough jobs’ market, expert career guidance and outplacement programmes with good quality outplacement can prevent well-qualified people having to take ‘stop-gap jobs’ and keep their careers on track.
“While funding for jobseekers is welcome, the chancellor’s scheme comes with an exceptionally high price tag. It’s likely to cost tens of thousands for every job found – by way of comparison we provide every participant with a careers coach, a personal branding expert, and a job concierge for a fraction of that.”
Supporting disabled job seekers
Diane Lightfoot, CEO of the Business Disability Forum, questioned how people with disabilities were going to be supported back into work and urged it to make better use of the Access to Work Scheme.
“Disabled people are far less likely to be in paid employment than their non-disabled peers – even before the pandemic. And research from Citizens Advice shows that disabled people are at far greater risk of redundancy,” said Lightfoot.
“Support for disabled job seekers needs to be tailored and address the very specific barriers which many disabled candidates experience, from inaccessible recruitment processes to a lack of line manager awareness. We also need to see an increase in the numbers of Job Centre staff with experience in supporting disabled people to find employment and up-to-date training on the skills that employers are currently seeking.”