Written evidence from PeoplePlus [PCW0051]
PeoplePlus is pleased to make this submission of written evidence to the Committee’s inquiry on DWP’s preparations for changes in the world of work.
This inquiry is timely. Whilst the Committee has highlighted the Fourth Industrial Revolution, and the impact of advancements on technology, fundamental changes to the world of work are inevitable as a consequence of Covid-19.
The pandemic has radically changed daily life and ways of working. It could also be argued that it has launched us into the Fourth Industrial Revolution. We have seen ways of working change fundamentally over the past three months: remote working and use of digital solutions have become the norm, and manually intensive forms of work have been most affected by social distancing measures.
As the UK emerges from the public health crisis, we should anticipate three things. First, that ways of working will remain changed. This will include greater use of flexible working where appropriate, with businesses able/needing to minimise overheads and the working population willing to change their habits if it provides a better work/life balance and reduces the potential for increases in carbon emissions and reduced air quality.
The second is that the workforce will have to be more agile and able to transition to different roles. Some sectors will take longer to recover than others, and workers will need access to training and employment pathways to find work in areas where demand is more acute. We have already seen this during the pandemic: non-essential retail was suspended whilst demand in food retail and food production increased significantly. This necessitated the transition of workers furloughed or made redundant to high-demand sectors.
During this time of real challenge, PeoplePlus, with our sister company Staffline, placed nearly 25,000 people into work through our ‘Feed the Nation’ programme – and similar worker transition models will be important in the months and years ahead.
Third, changes to ways of working will advance the use of automation, in many cases in place of roles currently performed manually. This will require changes to how we help people out of unemployment and back into work and the routeways traditionally used; also that the workforce is equipped with the training and skills it needs to embrace the Fourth Industrial Revolution.
That said, following the announcement made by the Prime Minister today (30.06.2020) indicating that significant investment will be made available to fund large scale infrastructure, technology and education projects at both a national and regional level, it is likely that this will open up new opportunities for areas that have been hardest hit and where unemployment is likely to be highest.
Large infrastructure investment projects such as those mentioned above not only address the significant immediate challenges posed by high rates of unemployment, but can help to address social value considerations. For example, employers delivering large-scale infrastructure projects who are committed to recruiting from disadvantaged groups can positively impact regional poverty levels, homelessness and crime rates, which in turn yields long term economic and fiscal benefits.
PeoplePlus is the leading adult skills and training provider in the UK, delivering apprenticeships, adult education, prison education and skills-based employability programmes across the country. We have a mission to make a direct difference to one million people by 2022, and every year we support many thousands of people into sustainable employment.
PeoplePlus is also the DWP’s largest provider of self-employment support delivering the New Enterprise Allowance in Birmingham and the Black Country, South West of England, Greater Manchester and Cheshire and across Scotland. We deliver contracts for the DfE, Ministry of Justice and the Employment and Skills Funding Agency, as well as local authorities and LEPs. We support more than 7,000 people a year to start their own business with 80 percent still trading after a year.
DWP’s preparations for changes in the world of work
The Department is likely to face a number of challenges as a consequence of the Fourth Industrial Revolution. Automation will fundamentally change the labour market, with jobs currently performed manually rapidly evolving to automated delivery models. This will create a shift in skills requirements for those in work as well as for jobseekers.
The Office for National Statistics has suggested that 1.5 million jobs in England are at risk from automation – i.e. they are roles currently performed manually but could be automated. Many of these manually performed jobs represent traditional routeways out of unemployment. This means that many of the ‘tried and tested’ ways in which DWP and its partners have historically supported the unemployed to move into sustainable employment will be subject to increasing change.
This challenge may be particularly acute amongst 16 to 24 years olds. A spike in unemployment as we emerge from the coronavirus pandemic is sadly inevitable, with the Resolution Foundation projecting that youth unemployment will rise by 640,000 this year to a total of more than a million. This will compound the impact of greater automation within the workplace: PwC has predicted that 28 percent of jobs performed by young people could be automated over the next decade.
In the long-term, we are confident that automation will create more jobs than it costs, but the challenge for DWP and partners will be to accurately identify the skills needs within the labour market and to ensure training/skills provision meets those requirements. This will require both data-led forecasting of economic growth areas and close collaboration with devolved areas to ensure support is delivered effectively.
The Fourth Industrial Revolution will clearly precipitate significant changes in the labour market. However, it is important to understand how these changes may be influenced or accelerated because of national experiences during the coronavirus pandemic.
The pandemic has necessitated changes to ways of working and to business models. Remote/flexible working and automated processes have proved more resilient in the public health crisis. Consumers have relied upon online shopping more than ever before. And those businesses operating during the national lockdown have had to place greater reliance on automation (e.g. contactless payments and self-service checkouts).
a. Are some sectors likely to be more affected than others?
The further adoption of many of these practices in the longer term should be expected and this means that some areas of the economy, such as retail or manufacturing, will change how they operate. Consequently, we may see the loss of some roles that can be performed mechanically (e.g. of manufacturing production lines) but capacity increases elsewhere in the workforce (e.g. in the oversight and maintenance of such automated systems).
During the pandemic, sectors providing non-essential services or products have been most affected and are likely to continue to be affected during the coming months where we are likely to see local lockdowns and tightening of restrictions. For example, the Business Impact of COVID-19 Survey published at the end of May showed that only around a fifth of businesses in the Accommodation and Food Service and Arts (21.9%) and Entertainment and Recreation (19.6%) sectors had continued to trade. On the other hand, some sectors including those classed as ‘key workers’ have been least affected by the lockdown measures. For instance, 97.1% of businesses operating in the Water Supply, Sewerage, Waste Management and Remediation activities are continuing to trade, followed by 95.4% in Human Health and Social Work; and 95.0% in Transportation and Storage.
The pandemic will also mean that different sectors recover at different speeds. Fundamentally this will replicate the situation during lockdown: capacity requirements in some industries will be depressed, whilst others experience increased demand. Jobseekers must understand the need for flexibility and the value of being able and willing to transfer their skills and experience to different roles as the economy recovers – albeit this will primarily affect those who have lost their jobs because of coronavirus, i.e. those closest to the jobs market and who therefore require less in the way of skills training. This widespread impact addressed through relatively short/sharp training interventions is likely to be the key feature or ‘shape’ of the jobs recovery programme supported by DWP and other relevant agencies.
b. Are some groups of people likely to be more affected than others?
Whilst automation will ultimately create more roles than are lost, two groups are likely to be most affected: these being the ‘hardest to help’ (i.e. the long-term unemployed, those with specific barriers to employment, and those classed as economically inactive) and young people.
A challenge is that many of the traditional routes out of unemployment are the jobs that will be impacted by automation (PwC predicting 28 percent of jobs taken by 16 to 24 years olds could be automated in the next decade, whilst youth unemployment is expected to increase sharply this year). There is a need to ensure support is in place for the ‘hardest to help,’ who have historically found themselves at the back of the queue when trying to access work and who, during recovery, will find that ‘queue’ massively lengthened.
That said, following the announcement made by the Prime Minister today (30.06.2020) indicating that significant investment will be made available to fund large scale infrastructure, technology and education projects at both a national and regional level, it is likely that this will open up new opportunities for areas that have been hardest hit and where unemployment is likely to be highest. For example, the West Midlands is expected to be a recipient of additional funding where it is anticipated that more than £3.2bn worth of funds will be made available to the region over the next 3 years, thereby supporting c. 135,000 to find alternative employment opportunities and thereby remain within the labour market.
Additionally, the demographic groups that have so far been most affected by the Covid-19 pandemic in terms of employment are:
Skills provision must also evolve to meet the changing needs of employers and to respond to local gaps and skills requirements.
DWP must also consider how services can best identify jobseekers’ existing skills and match them with local employers’ requirements – something which PeoplePlus accomplishes via our Skillzminer service which profiles the jobseeker’s skills and experiences versus their employment aspirations to match the candidate with relevant roles and preparatory training that may be needed to support their movement into these roles
c. What new types of jobs and opportunities could become more available?
New ways of working and living have meant that some industries have been able to do well throughout the pandemic and beyond, which may lead to job growth and opportunities in these sectors in the future.
For example, online companies, healthcare providers, supermarkets, pharmaceutical companies, technology companies and services, such as Zoom, have all played an important role in helping society through the pandemic, and are likely to continue to experience high demand as we emerge from the crisis. Technology companies are likely to provide a number of opportunities, for example Amazon is experiencing overwhelming demand due to increased consumer preference for online shopping. Similarly, companies that develop video games, and other forms of online digital/ VR entertainment have seen an increase in demand due to people using their products and services to pass the time and communicate with friends and family. These companies have been recruiting during the pandemic, and are likely to continue to do so as demand will remain high for the foreseeable future.
Skills provision must also evolve to meet the changing needs of employers and to respond to local gaps and skills requirements.
DWP must also consider how services can best identify jobseekers’ existing skills and match them with local employers’ requirements – something which PeoplePlus accomplishes via its Skillzminer service which profiles the jobseeker’s skills and experiences versus their employment aspirations to matches the candidate with relevant roles and preparatory training.
d. Is it likely that there will be a reduction in the number of jobs available?
It is likely that the immediate impact of Covid-19 will result in a reduction in the number of jobs available, especially as the government’s job retention scheme comes to an end and certain sectors are still not fully operational or have not recovered enough to return to paying all of their staff.
To deal with the volume of newly unemployed people and to help them back to work quickly, we need to mobilise DWP work coaches, the recruitment industry and new employment services to provide rapid support. Work coach capacity and the impact of social distancing means that government will need to draw on and mobilise a wider range of services to deliver this initial back-to-work support.
The wealth of evidence from previous recessions emphasises the importance of providing rapid and high-quality support for those who find themselves unemployed so that they can maintain contact with the labour market and move back into work as quickly as possible. Evaluations of specific interventions show that one-to-one advisory support increases employment entry and is cost effective – especially during the early phases of unemployment when targeted at those who are more job ready.
Building Better Opportunities, The Employment Guide (an evidence review conducted in 2015 to support the delivery of European Social Fund projects in England) stated that ‘personal empathy and attitude’ are the skills that make work coaches most effective. The best advisers are mentors and managers: i.e. they are those individuals that can motivate and challenge, work with partners, co-ordinate support and provide practical advice and guidance. Their understanding of employability and employment barriers, understanding of the jobs market, and practical skills in managing caseloads and organising their work are also vital skills that enhance effectiveness.
Availability and access to local market information is also crucial to DWP work coaches being able to provide the most comprehensive advice possible to jobseekers. Coaches have traditionally accessed this type of information through their networks of employer contacts and this approach will continue to the be backbone of local market intelligence.
As has been noted previously, we must expect significant changes in the labour market over the coming months and years. Some sectors will take longer to recover from coronavirus than others; whilst greater flexible working and use of automation/technology will also determine the job requirements and skills needs at local levels.
And so, identifying and tracking near-term future trends will be crucial to the training and advice given to jobseekers. PeoplePlus and Staffline have developed the Intelligent Routeway Framework (IRF) as a means to access labour demand-side information from the coming quarter so that training providers can prepare jobseekers for the roles they know will be needed – helping them get into as quickly as possible.
The IRF allows our growing network of training provider partners to match their training efforts to available roles which PeoplePlus derives from our analysis of employer vacancies and workforce forecasting information. Simultaneously, the IRF provides a unique service for employers by allowing them access to funded training to support their recruitment requirements. The service is available nationwide and is able to support hyper-local employment needs and can overcome individual candidate barriers to work.
The result is that training providers run local courses based on market intelligence and candidates are fully equipped with the skills they need to meet employer requirements. This creates a ‘win-win’ situation not only for providers, employers and the candidates themselves but for the bodies tasked with overseeing training support who can be reassured that investment channelled through the IRF is targeted with maximum effectiveness.
Ensuring work coaches are informed of market trends (i.e. where demand is likely to be) will help ensure they are giving jobseekers advice and access to support for the jobs that actually exist within the local area. Indeed, this focused approach means that PeoplePlus can give a guaranteed interview to those we support and deliver job-ready candidates to employers – resulting in an employment rate of more than 70 percent for our jobseekers.
PeoplePlus is currently liaising with the DWP as to how we can support that provision of intelligence through our relationship with our sister organisation, Staffline, the UK’s largest recruitment company, and the very many national employers whose recruitment requirements are increasingly serviced by the IRF.
Whilst the coronavirus pandemic will mean a sharp increase in unemployment, it is important that those looking to progress in work are enabled to do so. As an ESFA Skills Support for the Workforce provider PeoplePlus delivers retraining and upskilling support to enable individuals, including those facing redundancy, to achieve career progression. We also support low-skilled, low-paid learners to progress to higher-paid employment through our Skills Support for the Unemployed contracts. Our services include providing individuals with skills and qualifications; and information, advice and guidance from career coaches to build skills and resilience, supporting progression into permanent, sustainable, and better-paid employment. This experience has provided us with valuable insights into the most effective ways of enabling in-work progression.
Support must be based not only on the ambitions and job preferences of the individual but also in collaboration with devolved authorities, local councils, employers and stakeholders to ensure provision is responsive to local needs i.e. advice and training that is directly aligned to jobs that exist locally. This includes providing access to training courses that have a vocational focus aligned to local priority and growth sectors that will provide learners with training matched to genuine local career progression opportunities.
To ensure that training and support directly meets the needs of local employers, we use intelligence and data gathering to forecast the needs of employers. Our Intelligent Routeway Framework (IRF), developed with Staffline, enables us to significantly improve the quality of the service that we provide to employers through building a clearer picture of their skills needs, enabling us to plan and deliver courses, linking with other local training providers, based on preparing individuals for the short, medium and long-term needs of recruiting businesses. We currently have over 20 national employers signed up including: Health (BUPA), Logistics; Business/Professional (Amazon, Hermes), Manufacturing (Greencore), Construction (Balfour Beatty), Business/Professional; Digital/IT (Capita). This focused approach means that we can give interview guarantees and deliver job-ready candidates to employers, resulting in an employment rate of more than 70 percent.
Providing access to a Career Coach offering 1-2-1 support, career-focused IAG and knowledge of the local labour market is critical to supporting people identify and achieve in-work progression. For individuals in work, it is essential that any support provided has the flexibility to adapt to different ways of working and personal needs. The move towards more virtual ways of working in the face of Covid-19 lockdown has meant that businesses and individuals have had to rise to the challenge of harnessing technology to communicate with others and share resources to achieve mutually beneficial outcomes.
As part of our employability and skills provision, we provide our customers with access to the Skillzminer mobile application, which uses innovative Artificial Intelligence to provide virtual coaching support that can assess a customer’s strengths and career aspirations and use this information to suggest suitable careers with information on entry requirements (e.g. local employers with vacancies) and related careers that individuals can enter with additional qualifications or experience. We also provide our service users with access to Way2Learn, our online learning platform which delivers customised and responsive learning, allowing them to continue to learn remotely once in employment.
DWP’s role is and must be a significant one.
Young people will be the most affected by greater use of technology and automation within the labour market. This will mean the manual jobs many currently perform are made redundant; and as the UK’s future workforce, they must also be prepared for effective participation in a more technologically-dependent economy.
DWP’s responsibility is compounded by the impact of coronavirus on young people. Youth unemployment will increase significantly (to more than a million this year, according to the Resolution Foundation) and it will be more difficult in the short and medium term for young people, including school leavers, to find work and then progress.
With 800,000 young people likely to enter the labour market over the summer (Resolution Foundation) it is imperative that support is provided to local authorities and further education providers to track and engage young people NEET or at risk of being NEET, ensuring people get the right support at the right time, whether to stay in education or find work or combine work and training.
The solution should not be a ‘one size fits all approach.’ Services provided to the unemployed do not work as effectively for youth unemployment and 16-25 age careers advice has been significantly underfunded in recent years. Consequently, DWP must ensure it is providing tailored solutions for young people. This must encompass learning and use of the experience of partners such as Movement to Work; must be part of cross-government efforts that includes careers guidance in education settings; and which utilises data gathering to anticipate employer skills needs so training is directed to the jobs that exist.
PeoplePlus has delivered a range of local youth unemployment initiatives in recent years, including MyGo Youth Employment Service, commissioned by Suffolk County Council.
MyGo Youth Employment Service (November 2014 – March 2018) – Case Study
1. Contract summary: MyGo was a successful integrated programme to tackle youth unemployment, providing effective support to help young people aged 16-24 move into sustainable work. PeoplePlus and Jobcentre Plus worked in an integrated manner and were supported by over 30 local specialist support organisations (e.g. St Giles Trust, for ex-offenders) enabling young people to access all the support they needed through a single access point, as a holistic service.
Our Outreach Team worked closely with schools and colleges to ensure that young people who left education early were immediately referred to MyGo.
a. ‘MyPath’ Intensive Period - following registration and assessment by a MyGo job coach young people were classified into ‘Universal’, ‘Low’, ‘Medium’, or ‘High’ support categories. Participants immediately started co-creating their Work and Career Plan with their coach, setting out their career aspirations and the actions required to achieve them. As a first step all participants entered ‘MyPath’, an intensive 4 week period of coaching, employability training (e.g. CV writing, interview skills and ‘My30’ video CVs), and rapid referrals to specialist support partners if necessary.
b. Reassessment and Primary Activity - Participant’s support needs and their Work and Career Plan were regularly reassessed with activities/support being tailored accordingly. Alongside ongoing contact/mentoring with their coach, participant activities and support included:
c. Progress / In Work Support - Once the participant had secured a job, apprenticeship or self-employment they continued to be supported by their coach for 28 days and then our In-Work Support Team for up to 6 months.
3. Targets, achievements and outcomes: 62% of customers secured work or moved back into education and over 90% of all job outcomes were in full-time jobs. Suffolk County Council stated, “It is also important to acknowledge the contribution MyGo has made across all the JCP targets, demonstrating significant improvement in performance”. We placed a large emphasis on the quality of our service – reflected in the results of our customer survey’s, where 98.57% of participants stated they would recommend MyGo.
In partnership with the Staffline Group, PeoplePlus has developed the Intelligent Routeway Framework as a means of gathering data from large employers to understand and co-ordinate their training needs; and to apply it to local labour markets. This means the jobseekers we are supporting receive training relevant to the jobs that exist in their communities and that over 70 percent of learners can move into immediate employment.
This model demonstrates the benefits of close collaboration with employers.
Other opportunities for closer working with employers would include insight into any local challenges that prevent people getting into work (e.g. transport links or housing availability) so that these could be mitigated. DWP should also work closely with employers to understand what companies might be doing at local levels to support skills development; and to share intelligence on successful (also unsuccessful) employment and training pilots.
Understanding large employer’s redundancy plans at the earliest possible point is also crucial to ensure work coaches and employability providers can provide rapid response to redundancy support prior to individuals leaving employment, reducing the number of people becoming unemployed.
It is arguable at present that learnings from pilot programmes are not shared as widely or successfully as they could be. Better communication would ensure successful schemes can be mirrored across the country or adapted to meet the needs of local labour markets.
Changes to the nature of work are likely to include greater flexibility in terms of locations (i.e. remote working); also hours and working times. This will certainly be the case in the short-term as the UK recovers from coronavirus and employers have to ensure measures are in place to protect employees.
These changes and an expectation of greater flexibility by employee and employer can be supported through two models. The first is the agency model, as operated by PeoplePlus’ parent company; Staffline. This ensures individuals can benefit from earning opportunities whilst also being able to work flexibly; often determining their preferred working times or shift patterns to support work/life balance and family commitments. It is essential that workers have access to this specialist support and that the relevant legal structures are in place to support this.
An example is that of a current client - a former pilot, who having self-funded his training as an HGV driver, lost his job upon the collapse of Flybe. Through working for Staffline he has been able to earn a living as a food delivery driver, whilst also allowing him time to resume flight simulator training and hopefully return to his chosen profession in the future.
The second model is the booming gig economy which has more than doubled in size across the UK over the past 3 years and now accounts for 4.7m adult workers. As many as 1 in 10 working age adults now work on gig economy platforms up from 1 in 20 as recently as 2016. Research has shown that whilst those working in the gig economy often cited independence and flexibility as positive aspects of the work with some workers holding several jobs for different companies at the same time to maximise their earnings.
However, level of income, career development and training opportunities are considered to be the negative aspect of working in the gig economy. It is also important to recognise that gig economy workers are essentially self-employed and half of new businesses fail in their first year, and many struggle to make a profit in year one. These issues facing the gig economy can often go unaddressed due to the lack of specific support available for this cohort, as they don’t necessarily recognise themselves as self-employed – it is essential that they are be equipped with guidance and understanding as to how maximise their potential for success.
Whilst government should, as a matter of responsibility, consider how legal protections can maximised, we recognise that immediate support can be given to these workers as self-employed individuals.
PeoplePlus’ pioneering programme; EnterprisingYou, delivered in partnership with the Growth Company, funded by the Department of Education is designed to support Greater Manchester’s more vulnerable self-employed residents and those in the gig economy. The pilot engages and supports those who are already self-employed and identify the most effective support to help them sustain and grow their business and also works with those from the Gig Economy to support them to retrain and move into alternative preferred work if required. This first-hand delivery experience will provide insight into how best to support individuals employed in the gig economy and also how to change the legal definition of employment to ensure they get the same legal protections.
We recommend that DWP operate a common-sense approach to eligibility for gig economy workers to ensure they can access government funded programmes. Many individuals work both part time and operate in the gig economy and therefore we recommend that the relevant legal structures are in place to support this. These workers should also be able to access support by training providers and therefore we propose increasing flexibility for outcomes and employment.
For example, an individual who is both employed and operating in the gig economy may benefit from a range of support to ensure they are earning wages that can support them and their families, including: