Commission on the Future of Employment Support
The future of work and employment support
Institute for Employment Studies in partnership with abrdn Financial Fairness Trust
Work in progress
New analysis shows that major reforms to our employment and skills system are needed, to avoid weaker jobs growth contributing to higher inflation and falling living standards in the longer term
- Combination of ageing population, falling birth rates and lower labour market migration will see employment grow in the years ahead at less than half the rate than we’ve seen since 2000 – equivalent to 3.4 million fewer people in work by 2040 than if the trends of the last two decades had continued
- At same time, UK has the least well-used employment service in Europe – with rates of engagement at just one third of the European average, and a quarter of the rates in Germany and France
- Report summarises evidence gathered in the first six months of the Commission on the Future of Employment Support – which has been the largest consultation of its kind, hearing from over 200 organisations, individuals and employer bodies
- Report calls for major reforms to employment services to raise participation in the labour force and boost productivity at work – with next stage of the Commission due to develop options for reform
Working for the future
This analysis shows unemployment was being driven by a combination of people out of work for five years or more with long-term illnesses, lower migration and more students – but with new evidence showing how early retirement and Long Covid were contributing.
Key new findings include that:
- The UK is almost unique in seeing employment still lower than pre-pandemic, with the third worst recovery in the developed world.
- This is being driven by a shrinking workforce – with 600 thousand more people ‘economically inactive’ than in 2019.
- The smaller labour force is likely to be a lasting change – as Baby Boomers continue to retire through the 2020s, and due to lower migration – with half a million fewer non-UK born workers than there would have been on the pre-2016 trend.
- Recent years have seen a huge fall in access to Jobcentre Plus employment support, and often low levels of satisfaction from those who do get it.
- The UK lags behind many other nations on employment for disabled people and older people.
Call for evidence: summary of responses
In November 2022, the Commission launched a Call for Evidence, which sought views on what is working well within the current system, what could be improved and what learning could help to shape future reforms. The Commission asked in particular about how employment support:
- can work better for individuals, and particularly for those more disadvantaged in the labour market;
- can meet the needs of employers, both to fill their jobs and support good work;
- is organised and governed, including the role of the UK, devolved and local government and how services join up and work together locally; and
- can meet the needs of our future economy and society – supporting growth, economic change, an ageing population and transition to Net Zero.
The Commission received responses from 95 stakeholders, with a total of 249 pieces of evidence overall. For each of the thematic areas, the Commission received examples of good practice from across the UK and internationally. We are grateful for all those who contributed their expertise and views and are currently reviewing each of these submissions in detail. This short paper is a summary of the emerging themes from the Call for Evidence. It captures key themes from an initial review and is not exhaustive. A more detailed analysis of the evidence received will be included in the interim report from the commission which will be published in summer 2023.