Jobs? What jobs?

On Monday, David Cameron met with a number or retail organisations and the summit was quickly followed by the announcement that many of these firms would create 32,000 new jobs in the UK. Sainsbury’s alone would account for 20,00o of these jobs as the company fights to restore its position in the High Street.

All of this falls at a time when the British Retail Consortium announce that High Street sales fell by 0.3% on a like for like basis in December, whilst total sales rose by 1.5% - the slowest pace since April 2010.

At the same time, economic growth slowed sharply in the fourth quarter of 2010 according to the British Chamber of Commerce. The BCC forecast that figures would show the economy would grow by just 0.4% or 0.5% between October and December, down from 0.7% in the third quarter of 2010.

As if this wasn’t enough bad news for the government, the current CPI is 3.3% (a full percentage point above the Coalition 2% target), whilst the RPI stands at 4.7%. Leading business groups have warned that the recent hike in VAT from 17.5% to 20% will drive inflation up to around the 4% (CPI) mark over the coming months.

David Cameron has admitted the figures are disturbing. Last Sunday he was quoted as saying: "If you look at the recent [inflation] figures, they are concerning because they are well outside what the Bank of England is meant to deliver. Inflation is extremely harmful; it destroys people's savings we don't want to go back to having an inflation problem as we had in the past."

The retail industry is in decline. In December, ONS advised food store sales decreased by 1.3 per cent – this is the fifth consecutive fall, while predominantly non-food stores increased by 3.6 per cent. Meanwhile internet sales continue to increase as consumers move away from High Street shopping to online purchasing. Internet retail sales now account for approximately 10.5 per cent of all retail sales. This is the highest proportion since the series began. In comparison, in November 2009 this proportion was 7.9 per cent. On average, weekly internet retail sales in November 2010 totalled £660 million compared with the average weekly value for all retailing at £6,300 million (excluding automotive fuel).

Given this, one has to wonder at the wisdom of relying so heavily on a future blossoming retail industry, particularly as only 53% of staff employed in distributive trades is male. Meanwhile, almost 70% of the claimant count is male.

The Engineering Employers' Federation forecast that manufacturing in the UK will outperform other sectors and predicts manufacturing to grow by 3.5% this year. With this in mind, it is likely that manufacturing and not retail will offer future employment for many unemployed. Over the coming months, Proskills UK, the manufacturing sector skills councils are likely to turn to training providers for support. The question will be whether the training sector will prepared and able.
Existing evidence would lean towards an assumption that major providers such as A4e, Serco and working Links are nowhere near being able to support a re-emerging manufacturing industry. In large part these, and other independent welfare-to-work providers concentrate on offering low grade training courses in areas such as manual handling, first aid or fork lift truck driving. Gone are the days when providers could offer unemployed people the chance to reskill and train as welders, centre lathe turners, electrical work or foundry skills.
As Work Programme moves closer to becoming a reality, government and providers need to rethink what they are trying to achieve. New Deal and its infant, Flexible New Deal were far less successful than they were heralded and on top of that cost taxpayers heavily for little reward.

Now in the substance misuse world they have a phrase – ‘Insanity is repeating the same behaviour over and over expecting a different result”. Early indicators are that Work Programme will be little more than a repeat of New Deal, with the added tags of allowing providers less scrutiny and a different payment mechanism.
So what can we look forward to? Logically there is no evidence that Work Programme will be any more successful than any of its predecessors. But what is more concern is that the millions now facing unemployment or shortly due to lose their jobs will be denied real job opportunities by allowing them to reskill to join a potentially growing manufacturing industry.

New Labour denied millions of long-term unemployed the chance to retrain so they might secure sustainable employment. Now this Conservative-led government is repeating old mistakes. It’s time Ed Miliband made a clean break and questioned our entire welfare to work approach. Rather than being a mechanism to support those who are jobless, it is a tool for international corporations to make millions out of people’s misery. It needs to be changed.