Ian Mulheirn is Director of the Social Market Foundation
After days of confusion about work experience, mandatory work and the Work Programme, most people are probably stumped. But for those who are interested in the Government’s flagship back-to-work scheme for the long-term unemployed, the Work Programme, the big question is how is it going?
Unfortunately the DWP hasn’t released any data on provider performance, so it’s hard to know. The Department expects its contractors to get around 40% of adult JSA claimants into work for at least six months. Last August, we reported that past performance suggested that performance of around 28% might be more likely, and recently the National Audit Office corroborated that assessment. Adopting the same methodology the NAO concluded that the figure might even be around 26%. This is all very worrying for prime contractors and charities alike. But some people argue that the new programme is performing better than its predecessor. Are there any grounds for optimism?
Ultimately, the performance of the programme will mainly be determined by how the economy fares over the next couple of years. Unfortunately the outlook is pretty gloomy. When the Work Programme was commissioned, the Office for Budget Responsibility reckoned that the claimant count would fall steadily to 1.3m by 2013. Now it says the figure will rise to almost 1.8m, making it a tough environment for providers paid for getting people into work.
As the Work Programme is all about getting long-term adult JSA claimants (JSA25+) into work, a logical starting point is to look DWP data on the number of claimants moving into a job. Around 60,000 long-term JSA25+ claimants had found work by the end of January since the Work Programme kicked off in June, slightly below the 72,000 for the same period in the year before.
But whether 60,000 people finding jobs is ‘good’ depends upon how many people are looking for work. If there are 100,000 long-term unemployed people, then 60,000 into employment wouldn’t be bad; but if there are a million unemployed then performance would look poor. Indeed the performance percentage targets set by DWP are defined as the number of sustained job outcomes as a proportion of the number of people who move onto the Work Programme in a given year. Until DWP releases some figures on this in the autumn, we won’t know how things are going with any certainty.
But a rough proxy for the performance measure is the number of long-term JSA25+ claimants moving into work each month as a proportion of the total number of long-term claimants. The chart below compares this version of performance over the last two years. Unfortunately, the proportion moving into work each month has been consistently weaker than they it was last year. While none of this is conclusive it doesn’t exactly suggest that things are going swimmingly.
Last summer was when the old Flexible New Deal ended. It was also just about the time when the outlook for the UK and global economy began to deteriorate and unemployment to rise. Whatever the cause, the evidence to date gives us little reason to believe that the Work Programme is faring better than the Flexible New Deal.