Money spent on subsidies to employers who take on New Deal recruits could be better invested, and the training and recruitment of New Deal advisers is key, according to a report released last week by The Industrial Society.
The Society’s policy paper - ‘A Good Deal Better – Reforming the New Deal’ - argues that the one-on-one assistance provided by New Deal personal advisers is the most important single factor in the success of the Government’s flagship programme.
Gill Sargeant, Industrial Society policy adviser and co-author of the report, says: "The subsidy is not proving to be a particularly strong attraction for employers. Only a fifth of young people involved in the New Deal came as a result of the subsidised employment option. It can be dwarfed by the cost of bringing someone up to speed or the cost of management time for a placement that fails. Furthermore, to gain the subsidy there is a fair amount of form filling, which is another deterrent to employers.
"We believe the money currently spent on this would be better used if it were invested in the training and recruitment of New Deal advisers, and in improving the quality of help given with basic skills and confidence building."
The report is based on interviews with employers, New Deal recruits, personnel managers from Peugeot, Asda, Scottish and Newcastle Retail and Anglian Water and staff in the Employment Service, as well as Industrial Society contacts with other employers over the past two years. It concludes that the skills of personal advisers are undervalued, and recommends that the job be ranked alongside other public service professions such as teaching and social work.
Employers who participated in the research had either very positive or very negative experiences of the New Deal, with little in between. The main finding was that some employers are rejecting New Deal recruits because they do not have direct experience of the post in question, even though it is not particularly skilled or highly paid.
The report says that where employers adopt the approach of ‘give us raw recruits and we’ll train them’ they are often successful. It recommends that employers broaden their recruitment procedures, shifting the focus and resources from recruitment activity to investment in training.
The report argues that employers should be more imaginative about recruitment: ‘If a skills shortage is in IT, then someone doing reception or photocopying work could develop their IT skills – releasing a vacancy for a New Deal candidate.’ It calls for the Government to encourage employers to develop their training responsibilities under the New Deal and says that in order to encourage employers, and to compensate for the higher minimum wage for trained people, incentives should be offered to those with Investors in People accreditation.
Gill Sargeant says: "The Industrial Society has been actively involved with the New Deal since it started. We have recruited New Deal employees and developed a resource pack to help employers with the scheme. Our research and discussions with employers and New Deal participants show that the scheme has significant support. But the New Deal now needs to be reformed in order to achieve its own objectives."
