Lessons from America

The government could learn from some of the American progressive approaches to welfare provision

Despite unprecedented success in reducing unemployment, the British government now faces a clear but complex problem: how to help the significant minority of people seemingly stuck on incapacity, single parent, or unemployment benefit back into sustainable employment. The New Deal has helped 1.8 million people back into work but 3 million still remain beyond reach, trapped in a cycle of worklessness.

As chancellor, Gordon Brown often looked to America for advice and inspiration. Perhaps now as Britain prepares to overhaul its welfare system, he might look across the pond again to see what comparisons can be drawn and what lessons can be learnt from the successes and failures of America’s welfare reforms.

American progressive politics, as in Britain, believes in giving people the support and opportunity to move away from dependency. In the US numerous attempts have been made in order to help those hardest to reach back into employment, but only the infamous Wisconsin Model seems to have garnered serious attention abroad. In our home state of New York, where America Works operates, nobody is left in the abyss between employment and welfare benefits – residents of the state of New York have a constitutional right to welfare, the prospect of losing that right is not a stick America Works ever uses to push people into work. The truth is that there are less controversial and more practical approaches being employed by us and other agencies in America, which have been highly successful in bringing marginalised people back into the workplace.

And it is these examples, imbedded in the practical experiences of firms such as our own, that may provide some lessons as the UK government sizes up to the seemingly intractable problem of long-term unemployment. One practical step in America, which has helped cut welfare rolls up to 60 per cent, has been to require all welfare recipients to spend 30 hours a week in employment-related activities ranging from community work to training and job-seeking. The key here, however, is that participants are also given significant assistance by the state during time spent seeking work such as childcare, transportation and personal support – making work a more viable option.

In Britain the New Deal programme has concentrated on offering people education and training in order to enhance their value in the workplace and open further work opportunities for them. In and of itself this is no bad thing, but our experiences in the US suggest that getting people a job as soon as possible is more important. Everyone has a skill – the key is matching that skill with the right job. Work is as much a cultural issue as it is practical. People who have been unemployed for long periods of time must firstly be reintroduced to the workplace and the culture of 9 to 5 work. Training and education are vital but must be seen as an incentive or even a reward for getting a job and staying in it.

However, getting people a job is only a fraction of the work: real success in breaking the unemployment cycle can only be judged one, three, 10 years down the line. The New Deal in the UK, for all its merits, has been consistently unable to keep the long-term unemployed in work once a job has been found for them. The National Office of Statistics reported last year that 40 per cent of benefit claimants who get a job through the New Deal scheme are unemployed again within six months, an incredible figure.

At America Works, post-placement support is absolutely paramount. We have built on the government’s lead by providing support for job seekers not only before but after job placement as well. It is not rocket science. Most of the participants we deal with and the majority of people who remain unemployed in the UK have problems which can prove crippling when trying to find and remain in work. The static must be removed from people’s lives. At present in the UK people who have been out of work for a sustained period of time may understandably feel more secure and gain greater structure to their lives by remaining on benefits. It is the responsibility of the employment agency to ensure that their participants are given the foundations to succeed once they have been placed in employment.

In our offices in New York and California we have five bespoke programmes aimed at helping people with a range of backgrounds, from those who suffer from HIV/Aids to those who have criminal convictions and prison records, to gain sustained and meaningful employment. We act as their support both before and after they enter the workplace as well as being a mediator between them and their employer.

Getting people through the door simply isn’t enough, the work of an employment agency is in demonstrating to participants the value of employment which is achieved by providing both structure and support for people who have historically been pushed into work and then left to fend for themselves. This seems an obvious point that all agencies should recognise, but too often they are only concerned with ticking the box and receiving their fee. In order to change this culture in the US, our own agency has requested payment only be made once a participant has been in work for four months. This way we are rewarded for getting people jobs and ensuring they stay in them.

The UK economy has created an impressive foundation for high employment but to take the next step and move towards their stated goal of 80 per cent employment, the government needs to tweak its perceptions of welfare-to-work. Agencies employed by the government must be contracted with a clear obligation to firstly find the right employment for a participant and secondly to support that person until they are settled in the correct job. In America this philosophy has meant that over 80 per cent of the people we help are still in employment three years after they passed though our doors. A similar model in the UK might just heed similar results.

Lee Bowes is chief executive and Peter Cove is the founder of America Works

01 Feb 2008 00:00

 

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