November 28, 2012 • 6:32 pm

“…But the scheme is supposed to create sustained jobs for people, and in a whole year of the programme just two out of every 100 people got a job—that is a success rate of 2%.

The Government estimate that without the Work programme—this is the basis on which they did the tender—five out of every 100 people would get a job. Is it an historic first to have designed a welfare-to-work programme in which someone is more likely to get a job if they are not on that programme?”

Ed Miliband, Prime Minister’s Questions

This article was updated in June 2013. 

“I have to say to the Leader of the Opposition that I listened very carefully to what he said, and what he said was wrong. He said that only 2% of people on this programme got a job. That is not correct.

More than 800,000 people have taken part, and more than 200,000 have got into work. The specific figure that he referred to concerned people continuously in work for six months—but of course, he is only looking at a programme that has been going for a year, and the figure is 19,000 people.”

David Cameron, Prime Minister’s Questions

After yesterday’s release of official statistics from the Department for Work and Pensions (DWP) on the early achievements of the Work Programme, the issue predictably made it to the despatch box today as the Leader of the Opposition Ed Miliband attacked the Government’s record.

However after citing a 2% ‘success rate’ for the programme – similar to several news reports - the Prime Minister suggested this was wrong, and in fact more than 200,000 have found work as a result of the programme.

Let’s get to grips with what the two men are saying:

“in a whole year of the programme just two out of every 100 people got a job”

David Cameron said he listened carefully to Mr Miliband here – and indeed the Labour Leader is wrong to say that 2% of people involved in the programme “got a job”. The 2% actually refers to ‘job outcomes’ – these are paid to providers of the Work Programme if their participants have been in a job for 6 months (for most Jobseekers Allowance claimants) or 3 months (for everyone else).

In other words, ‘job outcomes’ are a means of detecting participants who’ve found sustained work for a certain period of time.

A look at the actual numbers confirms that 877,900 people were referred to the Programme in the first 14 months, of which 31,240 were recorded as job outcomes – this is the 3.5% (or 3.6%) being referred to across the media (see the bottom of the article for an update on this figure). Ed Miliband’s 2% (2.3%) covers the first year alone.

“More than 800,000 people have taken part, and more than 200,000 have got into work”

At first glance this looks very different to Ed’s figures, but we’ve established that Ed Miliband’s figures actually refer to people who’ve got sustained jobs for 3 or 6 months. This 200,000 figure simply refers to anyone who has entered a job since the Programme began – regardless of how long that job lasted.

His figure comes from the Employment Related Services Association (ERSA) - a trade body representing the contractors who help to deliver the Programme.

They also released figures alongside the Government yesterday that showed 207,831 participants “were placed into a job between the launch of the Work Programme in June 2011 and the end of September 2012″ (these figures are more up-to-date than the DWP’s). They make the point that the number of participants entering or re-entering jobs is increasing since the start of the programme, indicating increasing ‘success’.

Are these better indicators than the Government’s figures? According to an ERSA spokseman:

“the figures released by the Government are extremely limited in scope and only refer to the start up period of the Work Programme which co-incided with the double dip recession of late 2011. Since March this year, the Work Programme has really taken off and has now helped over 200,000 people into work.

“Because of the time lag between people starting work and counting as a government ‘outcome’, it will take some time before these show up in official government figures.’”

This is a valid point – there will be people on the Work Programme who’ve moved into jobs more recently in 2012 who won’t yet show up as ‘job outcomes’ hitting the 3 or 6 month target.

However, one of the Government’s “Critical Success Factors” when initiating the programme was to “increase average time in employment for WP customer groups (longer sustained jobs)” so merely moving people into jobs isn’t the complete picture. ERSA is confident most of the recent job entries will become ‘outcomes’, although this remains to be seen.

“Is it an historic first to have designed a welfare-to-work programme in which someone is more likely to get a job if they are not on that programme?”

The final point – as has been made across most news outlets – is that by the latest Government statistics the Work Programme is actually worse than doing nothing.

Sure enough, when the Work Programme was first being devised the DWP released information about the programme, including the “non-intervention performance“. As the Department said at the time:

“DWP will set a non-intervention performance for payment groups 1, 2 and 6 [JSA and some ESA claimants] reflecting the number of job outcomes that would be expected to occur in the absence of the WP. This is calculated by DWP based on analysis of historical job entry rates.”

The “minimum performance standard” for certain participants after one year of the Programme was 5% – plus a 10% leeway (so at least 5.5%).

Looking at all participants, 785,360 were referred to the Programme in the first year, of which 18,270 were ‘job outcomes’ (2.3%).

Just looking at the participants mentioned in the original target (those claiming JSA between 18 and 24, 25 and over and new ESA claimants), 554,290 such participants were referred to the Work Programme in the first year, of which 11,640 were job outcomes (2.1%). On either metric, the Government has unambiguously missed its target.*

*The figures in this paragraph are updated to include all relevant participants and accurate timeframes

UPDATE

In May 2013, the Chair of the UK Statistics Authority wrote to Iain Duncan Smith questioning these figures. 

Andrew Dilnot said that the 3.6% figure of claimants who have achieved a job outcome is not “the most relevant measure to use”, that’s because “many of the individuals would not have been in the scheme long enough to achieve six months sustained employment by July 2012.”

According to the Statistics Authority, the 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.”

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