As it stands, two of the biggest drivers behind the cost-of-living crisis are high levels of economic inactivity and low pay. As was discussed at length during both of ERSA’s joint party conference fringe events, with New Philanthropy Capital, employment support and civil society have answers to the problems facing this current government, but it is integral that we are listened to and supported.

Rising inflation has meant workers have suffered a real-term pay cut, people are more scared than ever before to leave benefits for work in the fear that they would be left worse off, and those that left the labour market during the pandemic may be pushed back into work because of their current economic circumstances.

The Department for Work and Pensions (DWP) method of “any job, better job, career” has not yet sufficiently lowered the levels of vacancy numbers, and more recent government announcements have proven that they are an incredibly long way away from tackling the roots of the problems facing people who are either unemployed, economically inactive or in-work.

As well as being a social problem, then a political one will soon follow for this government. The Centre for Progressive Policy recently found in their report, Hard Up: How rising prices are hitting different places, and how they can respond, that 71% of former Red Wall areas are identified as being in the 25% of local authorities most vulnerable to rising prices. These figures should seriously concern Liz Truss and they will hopefully ensure some significant action is quickly implemented.

With around 40% of Universal Credit claimants being in work, providing opportunities for secure work and routes for progression is vital to tackling this worrying figure. Employment support organisations can help with in-work progression thanks to their experience with Payment by Result programmes. This has meant that organisations, and their supply chains, have often had to continue working with jobseekers after they have started a job, to ensure that the individual remains in work. Placing people into insecure work is not beneficial to the individual or the economy, and it will certainly not persuade jobseekers to re-enter the labour market.

Similarly, on a smaller and more localised scale, ERSA members are perfectly placed to support people into the labour market. These, often third-sector, organisations are trusted in local communities and have relationships with the types of people that are currently unreachable by Job Centre Plus and existing DWP schemes. They can and should be integral in plans for economic growth.

ERSA members and the wider employment support sector have a proven track record of tackling the current problems that face this government, whether that is the problem of economic inactivity, the need for in-work progression, or filling the high levels of vacancies. It is a real shame that underspent funds on DWP schemes like Restart and Kickstart have gone back to the Treasury, instead of being spent on being responsive to the new problems that faces our economy and labour market. This, coupled with the end of the European Social Fund in 2023 and the ‘People and Skills’ strand of its replacement, the UK Shared Prosperity Fund, not being available in England until 2024, will mean that the employment support sector is stretched, expertise will be lost, and people will miss out on support.

ERSA has recently offered to utilise its vastly varied and experienced membership base and run roundtables for commissioners, including the DWP, to shape what comes next based on current experience, intelligence and information, and first-hand knowledge of what works. This will be combined with a focus on the sector’s experience of working with specific groups of people who are furthest away from the labour market.

It is vital that the employment support sector is listened to, in both the immediate and long-term. It is a sector filled with expertise, opinions, and experience, which should be utilised to help tackle the cost-of-living crisis that currently engulfs the United Kingdom.

Further information:

Henry Foulkes, Labour Market and Policy Researcher, ERSA

Contact Henry via

ERSA’s work on UKSPF

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Henry Foulkes chairing a panel discussion at the ERSA Conference in April 2022
Henry Foulkes chairing a panel discussion at the ERSA Conference in April 2022