Philip Whiteley looks at the prospects for success of Chancellor Gordon
Brown’s attempt to match the million people without a job to a million job
It is a personnel manager’s dilemma writ large – the Government has unfilled
vacancies, but potential candidates lack the skills to fill them.
Ministers say the "million people without jobs and the million jobs
without people" is an anomaly and a challenge at a time of continuing
economic growth. Hence the announcement by Chancellor Gordon Brown of "action
teams" to link unemployed people with specific vacancies in a nearby area.
With further promises on management training for entrepreneurs in deprived
areas, it is clear the Government is stepping up a gear in its bid for full
None of the latest gizmos will be spared. Already announced are the
Internet-based jobs and learning bank, putting information on jobs and
job-seekers on-line, and more "touch-screen" points in JobCentres
opening up access to vacancies in newspapers and private agencies.
Brown also highlighted the employment zones, set up by Education and
Employment Secretary David Blunkett. Headed by private-sector recruitment
agencies they will provide individually tailored work and training places and
help people start their own firms.
But is it just a question of skills and training? Closer investigation
reveals the problem is deep-rooted, and transport and housing are as important
as training. Britain has property bubbles and sink estates linked to employment
levels. They are stubborn and even entrenched.
The problem is described by Nigel Hutchings, head of policy at Bristol
Chamber of Commerce and Initiative. Parts of the city suffer from a lack of
skilled people, lack of incentive to invest, schools with falling populations
and declining standards perpetuating the low skills.
"We have to make sure employers moving to Bristol are going to be able
to recruit and that those moving in with families are going to be happy sending
their children to Bristol schools," he said. "What happens is
children are bussed out, putting pressure on schools on the periphery."
Surprising local commuting patterns spring up. Many people living in nearby
Gloucestershire now commute to Swindon, said Hutchings, which is thriving
thanks to major employers such as Motorola and Honda. But in some parts of the
country, travelling even as little as three miles to work is impossible if you
cannot afford a car.
Employers are likely to start looking at providing transport and even
housing for their staff, he predicts. But there is an alternative. "Maybe
it is a question of why firms are not setting up in the areas of high
Brown emphasises the need to revitalise deprived areas, rather than improve
transport to get people out of them. In a speech last week in east London to
launch the Government’s "enterprise tour", he urged corporate leaders
to "look at investing in our high unemployment areas – they offer business
new choices, new recruits and new markets". He promised cheaper finance
and management training for small businesses in such regions.
Local commuting can be encouraged at the same time. "The areas of
highest unemployment sit alongside, and within travelling distance of, areas
where vacancies are going unfilled," Brown argued. He cited Haringey in
north London and Knowsley in Merseyside – both areas with unemployment rates of
more than 10 per cent, in cities with more than 10,000 job vacancies.
Some problems are easier to address than others. Linking every school to the
Internet by 2002, and launching 1,000 IT learning centres in schools and
colleges will help familiarise future job-seekers with the modern medium.
But overcoming racial discrimination is more difficult, and Brown sounded
more vague. New compulsions on employers are seen by the Government as of
limited use, and the spread of good practice through the Race for Opportunity
initiative is slow.
Brown promised work with the equality commissions "to put together an
effective package of support and advice for businesses". The public
sector, soon to be subject to wider duties to eliminate racism (Personnel
Today, 1 February), is expected to take a lead.
Some problems are being skirted by the Government. Brown and Tony Blair have
an optimistic philosophy that everyone is trainable and employable. The UK
Household Survey published this month yielded the extraordinary statistic that
one in three unemployed people claims a long-term health problem. On this,
Brown was silent.
HR policy director at the CBI John Cridland said with the New Deal many
employers had found candidates less ready for employment than they had
Richard Pearson, director of the Institute for Employment Studies, said
governments have to be realistic and accept that nurturing entrepreneurs from
areas of low skills and high unemployment is a long-term programme. Some
unemployed people have very low levels of motivation.
But he welcomed the initiatives and argued employers could show more
imagination. As well as hiring people from ethnic minorities, there are those
with disabilities, many of whom have good IT skills. And long-term unemployed
people often undersell themselves and have more ability than they realise.
The skills gap is huge because the demand is typically for skilled,
experienced people such as office managers or IT experts, Pearson said. But
these vacancies do not have to be filled directly by the unemployed. "If
you can get unemployed people into work you can free up other people from
semi-skilled or menial tasks to become managers or entrepreneurs."
Cridland said employers have to think more laterally. "Disadvantaged
groups can lose out, not because companies adopt rigid recruitment processes,
but more because they do it informally, through word of mouth, rather than look
at an opportunity to help a run-down neighbourhood."
Any level of skills shortage when there is still considerable unemployment
is a waste. Employers have to realise it is not just a problem for government
to match the million unemployed to the million vacancies.
web links www.treasury.gov.uk
• A "Jobs and Learning Bank" – on-line information on vacancies
• A national telephone number for recruiters and job-seekers
• Touch-screen job points in JobCentres with links to all local vacancies
• Action teams to identify suitable jobs near an area of unemployment
• Employment Zone initiatives and the New Deal to help training
• Management scholarships for entrepreneurs from high unemployment areas. To
be piloted in London Manchester and Cornwall later this year
• Use of the Phoenix Fund to train small business managers and provide
cheaper finance in deprived areas
Solutions for companies
• Look at people with disabilities. A high proportion have excellent IT
• Make the organisation more attractive to people from ethnic minorities if
you have a "white" image
• Do not rule out investing in an area with a poor image – look how well
Nissan has done in Sunderland
• Consider solutions to transport or housing such as company buses or
working from home
• Offer to train someone who is bored with a menial job to do something more
skilled, freeing a vacancy for a New Deal candidate
• Consider part-time, flexible hours and short-term contracts