Tag Archives: Future Jobs Fund

“But why don’t those social enterprises take young people on anyway if they have genuine jobs to offer? The answer is economic. Social enterprises still struggle to attract mainstream investment so they are often undercapitalised and their restricted growth means that taking on skilled staff is a process undertaken carefully, and long-term unemployed young people with limited skills pose too great a risk.” 

Social Enterprise London(SEL)’s chief executive, Allison Ogden-Newton, explaining the impact of the premature demise of the Future Jobs Fund (FJF), an apparently successful but relatively expensive New Labour initiative to tackle youth unemployment. Under FJF, employers received funding from the Department of Work and Pensions (DWP) to pay young people aged under 24 at least the minimum wage for 25 hours a week for 6 months.

SEL’s Future 500 scheme enabled 164 social enterprises, including Social Spider, to employ young people through the scheme. As government funding schemes go, there was a phenomenally low level of bureaucracy involved, leaving social enterprises to focus on the challenge of offering unemployed young people what – for many – was their first experience of paid employment.

FJF was scrapped in June 2010 as the new coalition government offered an early declaration of its intent to make major cuts in public spending. Since then, youth unemployment has been rising and, in January this year, economist David Blanchflower noted that the number of unemployed 18-24 year olds reached 951,000, the highest number since comparable figures were first available in 1992.

As mentioned here, I don’t think it’s useful to claim that there’s a direct causal link between youth unemployment and the recent bouts of civil unrest in our city centres. Where there is a direct causal is between the current difficulties faced by young people looking for work and what Blachflower describes as ‘the danger these youngsters will become a lost generation’.

Blanchflower explains some of the reasons why young people are doing disproportionately badly in the current grim economic circumstances: “First, because firms operate last-in, first-out rules. Second, and more important in this recession, firms have cut hours and shifts and stopped hiring, including in the public sector, which of course hits the young hardest. It isn’t their fault.”

It’s difficult to blame employers for doing their best to continue to employ people they employ already when times are hard. The problem is that this makes an already difficult situation even more difficult for young people leaving school, college or university and trying to find their first job. The likely result is, as Blanchflower speculates, that (a substantial chunk of) a generation young people will miss out an early experience of the world of work meaning that, while most of them will work at some point, they may never catch up in terms of wages and career prospects. This is especially unfair given that they’re even less responsible than most of us for screwing up the economy in the first place.

Politicians of all parties have always been happy to rock up at an inner city community centre to bemoan a creeping moral decline linked to a pervading culture of worklessness, while happily explaining how whichever project they happen to visiting is doing such a great job of changing this dismal outlook in the local area. The fact that this rhetoric continued through years of relatively high employment may have partly served to mask the present horror. Either way, things are now officially really bad and many local projects are beyond political visiting.

Last year, Iain Duncan Smith, secretary of state at Department of Work & Pensions explained that is was ‘a sin’ for benefit claimants to fail to take up jobs. Unfortunately, there is not currently same the clarity from the government about its own responsibilities to young people looking for work.

Given what’s happened since, the abolition of the Future Jobs Fund is looking like an increasingly reckless step. So far, it doesn’t seem like any elements of the new Work Programme will offer similar low-bureaucracy, high impact methods of getting young people into work. Social enterprises are ready and waiting with the energy and ideas to help some of the nearly 1 million unemployed 18-24-year-olds break into the job market (as opposed to JD Sports). What we’re short of is cash.

While it seems unlikely that FJF will return in exactly the same form, something along similar lines – perhaps with the DWP paying a lower percentage of wage costs or focusing support on particular areas – seems increasingly vital.

Interesting pre-Christmas rumblings in parliament where MPs on the Work and Pensions Committee have published an initial report into the abruptly curtailed youth jobs creation scheme, the Future Jobs Fund (FJF). FJF involved the Department for Work and Pensions (DWP) funding 25-hour per week jobs for young people aged 18-24 (and some older people from specific groups). The jobs had to be ‘additional posts’ – not unreasonably meaning you couldn’t fire people and take on someone else to do the same job for free – that provided benefit to local communities.

The programme was obviously particularly useful for social enterprises. I’m not sure how things worked out for those based elsewhere in the country but, for us, Social Enterprise London’s Future 500 scheme was vitally important in making the FJF accessible to our social enterprise. I know because I tried to sign-up with the scheme which, in theory, was part-run by our local council. The joy of Future 500 was that it achieved what so many government-funding streams fail to do, it kept the paperwork to a manageable minimum so that social enterprises (including those with only a few members of staff) could access the money and get on with supporting the young people they were employing rather than getting buried in a mountain of forms.

The scheme worked for social enterprises partly because the Future 500 scheme included a well managed referral scheme – SEL parternered with Striding Out and Prevista to deliver this – and partly because getting to over-paid jobs for six months at no cost to your organisation is really useful. It’s very different to offering volunteering placements. Making successful use of volunteers within a mostly paid structure is usually extremely difficult to do and, even when it works, takes lots of management.

People who are being paid (even a fairly paltry wage) are more likely to turn up and more likely to do what they’re asked to do – partly because, as an employer, you don’t have to deal with moral uncertainty about the extent to which you can expect them to do those things.

So, did FJF work? If you don’t want to read the Work and Pensions committee report, I can tell you that the basic conclusion is that FJF was relatively expensive compared to other back to work provision but that social enterprises and other job providers thought it was really good. Given that I’ve just told you in 24 words what the report tells you in 48 pages plus appendices, and that I could have told you this based on my existing knowledge if the report hadn’t been written, you may or may not want to question whether collecting evidence for and publishing the report provides value for money.

That’s obviously a fairly silly comparison but it’s almost as silly as comparing FJF directly with back to work schemes that involve artificially simulating the experience of making a phone call or being repeatedly encouraged to have a more positive mental attitude. While these activities may have their place and may contribute to some people getting jobs quicker than they otherwise would have done, they’re definitely not directly useful to the local community.

It might be a monumental feat of holistic thinking, de-siloing or whatever else a civil servant might be told to call it but it’s worth considering the cumulative impact of programmes that have several different effects. So when a scheme like FJF simultaneously provides an employment opportunity for a young person and some extra capacity for a social enterprise, then it’s worth taking both into account. The committee report doesn’t ignore this dual function entirely but only 3 of the 48 pages are on benefits for employers and communities. This is not because the committee members are stupid, it’s because they’re the Work and Pensions Committee and their primary concern is scrutinizing whether the DWP is getting people off benefits and into work as cost effectively as possible.

It’s got to be possible that these times of austerity will finally be the catalyst for greater practical consideration of the effects of policies beyond departmental boundaries, based on the potential impacts on (The Big?) society as a whole.

A new FJF-style scheme could be a vehicle for simultaneously achieving the aims of several departments:

• the DWP need to get people into work
• the Department for Communities and Local Government (and others) attempts to build the Big Society
• the Department for Culture, Media and Sport’s need to support arts activity (and broaden access to jobs in the media)
• any spending department’s need to get some stuff done a bit cheaper – this is unequivocally not a call for any trained professionals to be replaced by unemployed young people on the minimum wage but, for example, their are many non-clinical functions in the NHS currently unnecessarily delivered by clinical staff.

As the report suggests, it’s too soon to judge the full impact of FJF, but what we know so far offers some good suggestions about what could usefully happen next.

Latest news from SEL in their weekly email update is: “Future Jobs Fund Update – We are pleased to share with you all that our Future Jobs Fund bid has passed the firs! t stage review by the DWP and is now with the regional teams to be scored against secondary criteria.  As soon as we hear back on whether the SEL led bid is successful we will let you all know.”

That’s good.

Exciting scenes at 1 London Bridge last night as Social Enteprise London (SEL) launched its attempt to put together a collective London social enterprise bid for the government’s Future Jobs Fund. Basically the Future Jobs Fund involves the DWP giving businesses a subsidy to employ unemployed young people (aged 18-24) in a ‘new jobs’ for at least 6 months – at which point the subsidy stops but the jobs hopefully carries on.

There’s £1billion worth of funding in total designed to fund the creation of around 150,000 new jobs. The jobs have to have ‘community benefit’ and there’s some emphasis on ‘green’ and ‘cultural’ jobs. In theory, 15,000 of these jobs will be created by social enterprises. SEL’s bid is going to be called London’s Future 500 – so, unsurprisingly, will involve the creation of around 500 jobs. The overall package of mentoring and support sounded really good. My organisation’s definitely keen to be involved.

I think this could be an interesting moment for social enterprise (and for social enterprise support bodies). If SEL is successful in making this kind of direct intervention in a realm usually primarily occupied by local councils – the distribution and supervision of large amounts of new streams of central government cash – then this seems to open lots of interesting possibilities.

I’m interested to hear what anyone else thinks.