It feels like it’s been a long wait for significant announcements about employment programmes to address the impending Covid unemployment crisis. Kickstart has, in general, been greeted positively as an important step in this.
Targeted at 16-24 year olds who are job-ready, Kickstart is a wage subsidy scheme that covers 25 hours per week at the National Minimum Wage plus £1,500 for training and set up plus employer National Insurance Contributions. An ambitious target of 250,000 or more placements has been set, more than previous, similar initiatives.
Employers also need to be able to offer at least 30 individuals placements. Alternatively, they need to get together with other employers to provide 30 placements as a group. Additionally, employers have to commit to provide support to young people to look for long-term work, CV preparation and training.
Obstacles to be overcome to get businesses on-board
Stimulating job creation is certainly to be applauded and it is an element that has largely been missing from UK labour market policy over the past few decades. However, research evidence and experience from practice suggests that are likely to be obstacles to be overcome to get businesses on-board.
We know from evidence that initiatives that sound convincing to policymakers do not automatically translate into compelling offers for businesses. Promotional material coached in programme language, not business language, turns employers off and makes it hard for them to see the value proposition.
I have long argued for the importance of the demand-side in the design, commissioning and delivery of employment and skills programmes. My comparative data show that employer engagement in programmes in the UK on an ongoing basis is low.
However, this is often overlooked by policymakers, who assume employer predisposition towards programme offers. We know that employers have historically had positive experiences with Jobcentre Plus but latterly this appears patchy and, in many cases, employers will need to be convinced to engage.
It needs to be made as easy as possible for employers to quickly find out the benefits of Kickstart for their business. My research shows that many businesses are keen to ‘give young people a chance’ but it also needs to be made simple for them to engage.
Smaller businesses are likely to be left out in the cold
At a time when business models are being pivoted to respond to the challenges of the Covid context, the Kickstart scheme may be a relatively easy sell to businesses who are already confident of the direction of their business and their workforce needs.
The requirement to offer 30 or more placements is likely to appeal mainly to large businesses with well-resourced HR departments which have a handle on workforce planning. However, businesses who are not in either of these positions will need to be approached in a much more consultative manner to identify their needs.
Additionally, smaller businesses, who are likely to benefit from the ‘hand-up’ of Kickstart will not be able to engage without partnering with other organisations. This relies on good partnerships and networks. In our research we found that, where employers were part of business networks both formal (such as employer associations) and informal, relationships were strong.
But many smaller businesses are likely to be left out in the cold. We also know that smaller businesses prefer face-to-face contact and are likely to struggle with the resource implications of self-organising online amidst more pressing daily business priorities.
Ongoing engagement with employability providers
Providing support to help young people to find longer-term work and CV preparation and training. This will require ongoing engagement with the DWP and perhaps also other employability providers with expertise in this.
We know from previous evidence and experience that trying to put employers in the driving seat does not mean they are in control of the car; they are often merely passengers, of hitching a ride. Additionally, there is the broader institutional context for training in the UK. In countries such as Germany and Denmark, with a more coordinated market economy, training individuals is a business-state-trade union partnership.
There is, in generally, an expectation (and acceptance) on the part of employers that successful progression for employees may be outside of their company, meaning the return on investment does not come back to them.
By contrast, in a liberal market economy such as the UK there tends to be a reluctance on the part of employers to invest in employees who may move on elsewhere. It is desirable that a shift is brought about in this mindset but whether Kickstart alone could achieve this is questionable. However, even the much-lauded Danish wage subsidy scheme struggles to gain commitment from businesses to provide the required training.
Business benefits front and centre
Ultimately, Kickstart needs to be proactively offered to employers, with the business benefits front and centre. Employers are bewildered and frustrated by the complexity of programmes available so, ideally, the scheme should be offered as part of a suite of initiatives in any labour market area.
We need to take this opportunity to move away from the fragmentation and complexity common to employment and skills programmes. What we need in both programme design, commissioning and delivery is a needs-led rather than product-led focus on businesses.
As Mark Cosens emphasised in his article in FE News on 12 August, the DWP CAEHRS framework and programmes that will follow mean there is huge opportunity for genuine partnership amongst employability and skills providers.
It is to be hoped that all partners across the employability and skills sector take this opportunity to engage in co-opetitive practice, linking up with competitor organisations in order to better service the needs of businesses.
Jo Ingold FIEP, Associate Professor, Deakin Business School