Richard Derecki: What has government’s Kickstart jobs scheme done for young Londoners?

Richard Derecki: What has government’s Kickstart jobs scheme done for young Londoners?

The number of 16 to 24-year-olds out of work in London has started to fall, yet at the back end of last year there were still some 100,000 young people in the capital looking for work – that’s about 20 per cent of them, with the highest rates among women and Londoners of African or Caribbean heritage.

Next month the government’s Kickstart programme, a flagship national initiative designed to create 250,000 work placements for young people on universal credit, will come to an end. How much help has it been to young Londoners and will it be missed?

It has surely played a part in getting some of them into jobs: just over 21,000 placements have been started in the capital since the £2 billion scheme began in September 2020 and with 40,000 available in all, more will be secured before Kickstart winds up.

The context, however, is that the national target has been revised down to 168,000 placements raising questions about the efficacy of the initiative. Also, DWP research on the first 20,000 Kickstart participants nationally found that those with higher levels of education were more likely to be referred to Kickstart jobs and be appointed once referred. This might not be the group that needed support the most.

In London, the latest skills survey for the London Chamber of Commerce and Industry (LCCI) suggests Kickstart has struggled to gain traction with employers. The scheme pays firms the full national minimum wage rate for the young person’s age, plus a pension contribution, for 25 hours’ work a week.

The government also gives employers £1,500 to provide support and training for those on placements to equip them for later securing a permanent position. Yet only five per cent of LCCI survey respondents said they would look to employ a young person through Kickstart, with small and micro firms the least likely of all, citing extra costs, administration and management being required.

Some London local authorities have been working closely with employers to create jobs suitable for the scheme and even created their own Kickstart placements. Camden, for example, has over 2,000 placements available of which 600 have been filled, with a third of those with associated with the local authority.

However, Camden Council cabinet member Danny Beales says there are still “massive delays” with processing the placements with the Department for Work and Pensions (DWP) and therefore filling the posts. The National Audit Office has found that it can take more than two months from the post going into DWP and it even being advertised.

Some employers have also experienced delays in payments coming through, which has undermined their confidence in the scheme. Beales would have liked to have seen “a more collaborative approach, with local authorities being able to advertise the placement themselves and to be able to refer candidates directly for roles”.

In a challenge to this highly centralised job-brokerage system Sadiq Khan has recently launched a set of academies hubs across key sectors in London such as creative, green, health and hospitality. Each one brings together employers, education and training providers and sector bodies to develop pathways into employment and ensure a coordinated offer of training, work experience and advice and guidance for Londoners. Those 19 and over and unemployed or in low-income work will then be able to access training courses for free at local colleges and adult education providers.

Tony Wilson, director of the Institute for Employment Studies, wants to go further. Sceptical about the government’s most recent national target for getting people of all ages into jobs, he argues for “a modern employment service that is open to everyone – in and out of work, on any benefit and none – who want help to find their next job and open to employers who want help to find and develop their staff.”

This would require funding and significant bureaucratic shake-up. But with Kickstart expected to be underspent by £750 million there are funds available. The levelling-up white paper proposes three so-called “pathfinder areas”, one of which will cover Barking & Dagenham, which could work in that way if properly resourced, but as with much of the White Paper detail is lacking.

There is an opportunity here to create a positive legacy from the pandemic for young Londoners and others alike. The Mayor has made a start, will central government rise to the challenge to better help boost participation, skills and good jobs?

Photograph from GLA.

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Categories: Analysis

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