Is the Work Programme getting Britain working?

21 June 2013

"These alarming figures now show something is very seriously wrong with the Work Programme. Two years since it was launched and nearly 900,000 people on the programme haven't even started a job. It's now crystal clear the system is failing - and the Government isn't fixing it." Liam Byrne, Labour Party, 20 June 2013

This article was updated on 27 June 2013. See below

Statistics released yesterday by the Employment Related Services Association (ERSA), the trade body representing the contractors who help to deliver the Work Programme, have ruffled a few feathers inside and outside Parliament.

In a week's time the Department for Work and Pensions will deliver its own assessment of the Work Programme's performance, and these figures will provide a slightly different take on the situation.

According to ERSA's figures, the Work Programme, which was introduced in June 2011 with the aim of tackling long-term unemployment, enlisted 1.2 million jobseekers for up to two years of training, support and work experience.

Out of these 1.2 million, 321,000 had found employment by the end of March 2013, an increase on the 207,000 who had found employment by the end of September 2012.

So it is right to say, as Liam Byrne did in his blog, that nearly 900,000 people on the programme haven't "found their way into a single day's employment". But does this necessarily mean the figures are discouraging?

Though this might be a reasonable first impression of the figures, it's also fair to point out that they offer a limited picture.

Job starts vs. job outcomes

The statistics provided ERSA are not subject to the same standards as official government statistics. This doesn't mean that the figures are inaccurate, but a note of caution is necessary.

As the release says:

"The referral data figures have been produced by the industry and should not be used as a substitute for official data on referrals and attachments that will be published by the government on 27 June 2013."

For example, the ERSA data refers to job starts: the number of people beginning a job after taking part in the scheme. This could be anything from a single shift, or self-employment, upwards. ERSA do not we do not put a threshold on the amount of time someone is in a job for it to be counted as a job start. A spokesperson tols us they estimate the between 65 — 85 % of job starts will be sustainable. As the Work Foundation has pointed out, the Department for Work and Pensions prefers to measure success by looking at job outcomes: the number of people gaining continuous employment for at least three months.

Because individuals can have more than one job start over the two years that they are enrolled on the programme, job starts may not be the best measure of success. It is only when a jobseeker achieves a 'job outcome' that a provider receives the majority of their funding.

ERSA does provide an estimate for job outcomes. It says it believes that "between 65 and 85 per cent [of those gaining a 'job start'] will go into sustained employment, which will qualify as a 'job outcome' in the official government statistics."

ERSA's members provided them with these estimates, but nevertheless we should take the figures with a pinch of salt given that there is no way to validate them. The DWP doesn't release figures on job starts, so we don't know what relationship exists between 'starts' and 'outcomes'.

Paul Bivand - Associate Director of Analysis and Statistics at the Centre for Economic and Social Inclusion - thinks this shouldn't put us off ERSA's figures.

According to him, it is just as important to keep track of job starts as it is for job outcomes, especially so that we can compare the Work Programme with previous government schemes such as the Flexible New Deal, which measured its success by both job starts and job outcomes. If we only have the outcomes data from the official statistics, we could only make half of this comparison.

Though these two releases aren't comparable, there's a case for them being complementary.

Success or failure?

So how does Labour's assessment fit into this? Have they spoken too soon?

It wouldn't be the first time that these figures caused confusion.

When the DWP last released official figures on the Work Programme in November, we were told 3.6% of participants referred to the Work Programme between June 2011 and July 2012 were ending the scheme with a job lasting six months or more, some way below the DWP's 5.5% target.

Labour denounced these figures, while a report by the National Audit Office and one by the Public Accounts Committee also focused on the failure to meet the target.

However as the UK Statistics Authority pointed out, many of the individuals would not have been in the scheme long enough to achieve six months sustained employment by the time the figures were released.

In a letter to Iain Duncan Smith on the DWP's release, Andrew Dilnot argued that a more relevant figure "is that based on the June 2011 cohort on its own — namely that 8.6% of those referred to the Work Programme in June 2011 were in sustained employment of at least six months (or three months if hard to place) at some point during the 12 months following referral." [Emphasis added]

As Andrew Dilnot says in the letter, "statistics on the Work Programme are relatively complex and unfamiliar to commentators, particularly at this early stage in their development."

In another week for the latest official figures will be able to deliver a more complete picture of the progress of the Work Programme in the intervening months. We'll update readers next week once we have these details.

27 June 2013: The DWP releases its official statistics on job outcomes

Today the DWP published its statistical release on the Work Programme

As we say above, the UK Statistics Authority has stated that the best measure of success is that based on the percentage of individuals who have been in the programme for a minimum of 12 months and who have subsequently achieved sustained employment for at least six months, "or three months if hard to place". 

Following 12 months in the programme, 9.9% of claimants have met that measure. (See page 37, table 2.19)

In the release, the DWP also adopts another measure. The release says the success rate of the programme should be assessed against a minimum benchmark of three or six months in the programme. So while 1.2 million individuals have been referred to the programme since its inception in June 2011, of these 1.02 million had spent the minimum sufficient time on the Programme to attain a job outcome payment. 

132,000 individuals have found work. This means that of those who had spent sufficient time on the programme, 13% achieved a job outcome and "most of these are staying in work". 

Of course, the job outcome rates vary considerably depending on which cohort and "payment group" - defined by age, benefit type and availability to seek work - we focus on, as we can see below. 


Flickr image courtesy of Horia Varlan

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