Universal Credit and Employers: exploring the demand side of UK active labour market policy

Lead Research Organisation: Manchester Metropolitan University
Department Name: Manchester Metro Uni Bus School (MMUBS)

Abstract

Research context: Active labour market policies (ALMPs) are government interventions traditionally focused on moving unemployed people into work. As those ultimately in control of the employment opportunities participants are seeking to access, employers are fundamental to ALMP outcomes (Bredgaard; 2017; Sissons and Green, 2017). However, research and policy relating to ALMP has tended to ignore employers. Focusing on UK ALMP, as enacted through Universal Credit, this research will help to advance knowledge of this topic by focusing on employer perspectives of ALMP and the conditionality that underpins it for unemployed people and workers on a low income. The research will explore how ALMP is understood and experienced by UK employers, how it impacts on how businesses are run, and how employment services can work more effectively with employers, leading to better outcomes for individuals and the wider economy (McCollum, 2012).

The UK's main vehicle for ALMP, and flagship policy of recent welfare reforms is Universal Credit (UC). UC is the new working age benefit for those who are either out of work or on a low income (DWP, 2010). Under UC, social security for unemployed people is conditional on claimants demonstrating work search and other work-related activities. This is underpinned by a 'Work First' approach, emphasising high volumes of applications and fast work re-entry. It also potentially involves the extension of conditionality to those in work, blurring the traditional distinction between social security claimants who are in and outside of the paid labour market (Dwyer and Wright, 2014).

Aims and objectives
The project has four main aims. Through qualitative semi-structured interviews with employers, policymakers and other key stakeholders, this research project will:
1. explore how UK ALMP is understood and experienced by employers
2. identify how ALMP impacts UK businesses, including how they recruit, retain and progress their staff (and explore differences between sectors)
3. explore how the impact of ALMP on employers varies in different low pay sectors
4. explore how the public employment service can work effectively with employers to lead to better employment outcomes for claimants

To realise these aims, the project is underpinned by four related objectives:
1. To generate new qualitative data on how ALMP impacts on employers and firm behaviour through consultation with employers, policy makers and other key stakeholders
2. To expand scholarly understanding of ALMP and its impact, beyond a traditional supply side focus on unemployed claimants
3. To identify ways in which public employment services (i.e. Jobcentre Plus and other contracted providers) could work with employers to help Universal Credit claimants enter and progress in work
4. To inform policy development and debate relating to ALMP for both unemployed and working Universal Credit claimants

Potential applications and benefits
This research has been designed to have clear benefits for multiple stakeholders: policymakers in the Department for Work and Pensions (DWP) will benefit through the insight it will provide into employer interactions with ALMP; employers will benefit as it will enable their voices to be heard on policy which impacts them and their staff; employer representative organisations will benefit through greater awareness of how UC impacts on the businesses they represent; employment and skills agencies, unions and other organisations supporting UC claimants will benefit from a greater awareness of how UC interacts with employment practices, which can help to shape their advice and support; Universal Credit claimants will benefit through more informed public debate and policy development which better reflects the realities of work, thereby enhancing the effectiveness of support for claimants; and academics will benefit through new insights and the creation of a new dataset.
 
Description This was the first major independent study to explore employer views and experience of Universal Credit (the main UK benefit for people who are out of work or on a low income) and the approach to employment policy/support that underpins it.

This research uncovers how Active Labour Market Policy (policy traditionally focused on moving unemployed people into work) is understood and experienced by employers, whether or not (and in what ways) it impacts on them and the way they recruit, retain and progress their staff, and how this varies in different sectors (with a key focus on social care, retail and warehousing and hospitality). It also considers how Jobcentres and other employment support providers can work more effectively with employers, in order to lead to better outcomes for individuals and the wider economy.

The research involved 124 in-depth semi-structured interviews with three stakeholder groups:

i) 84 Employers: mostly drawn from traditionally low paying sectors that are a common destination for jobseekers: social care, hospitality and retail and warehousing.

ii) 20 Local stakeholders: including local policymakers/actors drawn from Greater Manchester and West Yorkshire, local employer representatives, including representatives from Business Improvement Districts, local employment support services (e.g. staff from local Jobcentres/other contracted employment support providers), and a trade union representative.

iii) 20 National stakeholders: including policymakers, national employer representative organisations and key sector representatives, unions, employment support sector representatives, and independent research organisations.
Exploitation Route This research generated practical recommendations for:
The Department for Work and Pensions, Jobcentres and other employment support providers
Wider policy stakeholders
Employers and their representative organisations
Trade unions
Researchers (academics and think tanks)
Recommendations relate both to policy and practice, and can be found here in this short briefing note > https://www.mmu.ac.uk/sites/default/files/2023-01/Universal%20Credit%20and%20Employers%20briefing%20note_2023.pdf
Sectors Communities and Social Services/Policy

Government

Democracy and Justice

URL https://www.mmu.ac.uk/research/projects/universal-credit
 
Description This research has several key beneficiaries including policymakers, employers, other related stakeholders including employment support services and trade unions. National policy: 1) Department for Work and Pensions (DWP): Katy Jones has been invited to deliver bespoke presentations for multiple teams in the DWP across policy and operations, following their engagement throughout the research process and attendance at the launch event (e.g. DWP Policy Team, In-work Progression team and Universal Credit and Analysis Division). 2) Parliamentary committees: Based on written evidence submitted to the House of Lords Economic and Social Affairs committee and the Work and Pensions Select Committee I was subsequently invited to give oral evidence as an expert witness - and both this written and oral evidence have been cited in final inquiry reports (Plan for Jobs Inquiry; HoL Economics of Universal Credit and Covid Employment Support) 3) Shadow Employment Minister Alison McGovern MP, I briefed the Shadow Minister, who has subsequently begun to emphasise the importance of shifting away from the historic 'any jobs' approach of the DWP and emphasise the importance of engaging better with employers. The Shadow Minister has since agreed to support a conference we are organising on this topic as a keynote speaker in Spring 2024 4) Universal Credit All Party Parliamentary Group, I was invited to share key research findings with this group. In addition to direct engagement with policymakers, the research has further influenced national policy debates through engagement with several leading think tanks. It has been cited by all major think tanks that have recently published on the future of employment support E.g. IPPR Future Public Employment Service; the New Economics Foundation's "compliance to engagement" briefing; and the Federation of Awarding Bodies' recent skills report. In addition to being cited, Jones was also an invited expert witness in the Institute for Employment Studies Commission on Future of Employment Support. The research has also been cited by a coalition of charities and advice organisations including Gingerbread and Single Parent's Rights, who have written to the Work and Pensions Committee to request an Inquiry into the likely impact of "In-work conditionality" for UC claimants. Local Policymakers 5) Following our successful launch event, I worked with colleagues at West Yorkshire Combined Authority to co-host a local event in order to explore how to integrate key recommendations into local policy and practice 6) I have worked with the Greater Manchester Good Employment Charter to highlight the need for employability/jobcentres and good employment agendas to be better aligned Employers Employers and employer representative organisations 7) This project worked with employers to ensure their voices are heard on policy and related issues which affect their organisations and their staff. This is a significant impact given that employer perspectives have been largely absent in this space. Employer representative organisations have benefited through greater awareness of how UC impacts on the businesses they represent, alongside greater awareness of ongoing policy changes (e.g. The research has been endorsed by several industry leaders including the Chief Executive of UK Warehouse Association https://warehousenews.co.uk/2023/02/giving-employers-a-voice-developing-active-labour-market-policy/), the Federation of Small Business's employment policy chair (https://www.businesslancashire.co.uk/2023/02/03/lancashires-woman-in-business-and-federation-of-business-employment-policy-chair-speaks-at-mmu-universal-credit-and-employers-report-lunch/) and the Chief Executive of Greater Manchester Chamber of Commerce). Following endorsement from the UKWA, I was then invited to share research insights at with industry representatives at their IWLEX conference. Employment support sector. 8. Organisations supporting UC claimants have benefited from a greater awareness of how Universal Credit/employment support interacts with employment practices, and how they can better engage with employers, which is helping to shape their advice and support. Jones has worked closely with the employment sector, primarily through the Employment Related Support Association (ERSA), who were a partner on the original funding bid and who have shaped this research through ongoing engagement and support to disseminate (e.g. Employer Engagement forum). The research was publicly endorsed by the ERSA chief Exec (FE News https://www.fenews.co.uk/exclusive/working-for-better-work-prioritising-employers/) and the Growth Company who have put key recommendations into practice (ERSA employer engagement forum). The research has underpinned further sustained engagement across the employment support sector. Trade unions 9. Following the publication of research findings, we were invited to Bristol Transformed festival to disseminate our reports further alongside Unite trade union representatives. This then led to a further collaboration through a co-organised ESRC Festival of Social Science event in collaboration with Unite. MMU researchers successfully hosted a workshop as part of the ESRC Festival of Social Science, in partnership with Unite Community. The event, "Universal Credit as a Trade Union issue", shared research insights and policy debate relating to new conditionality rules for working UC claimants, considering how trade unions can best support workers impacted by these changes, and the trade union's broader role in influencing the policy development of policies which have huge implications for workers and organisations. The event included delegates representing five national trade unions and has prompted further collaboration relating to this policy across different trade unions. Following this Katy Jones was invited to present at an event in Parliament organised by Unite, the research also features in a Unite policy and campaign video.
First Year Of Impact 2023
Sector Communities and Social Services/Policy,Government, Democracy and Justice
Impact Types Societal

Policy & public services

 
Description Citation in IES report
Geographic Reach National 
Policy Influence Type Citation in other policy documents
 
Description Citation in IPPR report
Geographic Reach National 
Policy Influence Type Citation in other policy documents
 
Description Citation in Work Foundation report
Geographic Reach National 
Policy Influence Type Citation in other policy documents
 
Description Cited in New Economics Foundation policy briefing
Geographic Reach National 
Policy Influence Type Citation in other policy documents
 
Description Cited in Work and Pensions Select Committee Plan for Jobs report
Geographic Reach National 
Policy Influence Type Citation in other policy documents
URL https://committees.parliament.uk/publications/40930/documents/200444/default/
 
Description Work and Pensions Select Committee - Plan for Jobs Written Evidence Submission
Geographic Reach National 
Policy Influence Type Contribution to a national consultation/review
Impact Following this written evidence submission, I have been invited to give further oral evidence to the Committee. I will record details of this in my next research fish submission
URL https://committees.parliament.uk/writtenevidence/111570/pdf/
 
Description Written submission to Commission on the Future of Employment support
Geographic Reach National 
Policy Influence Type Contribution to a national consultation/review
 
Description Universal Credit, Good Work and Progression
Amount £393,230 (GBP)
Organisation Nuffield Foundation 
Sector Charity/Non Profit
Country United Kingdom
Start 09/2023 
End 10/2026
 
Title Universal Credit and Employers: Exploring the Demand Side of UK Active Labour Market Policy, 2021-2022 
Description Active labour market policies (ALMPs) are government interventions traditionally focused on moving unemployed people into work. As those ultimately in control of the employment opportunities participants are seeking to access, employers are fundamental to ALMP outcomes. However, research and policy relating to ALMP has tended to ignore employers. Focusing on UK ALMP, as enacted through Universal Credit, this research helps to advance knowledge of this topic by focusing on employer perspectives of ALMP and the conditionality that underpins it for unemployed people and workers on a low income. The research explored how ALMP is understood and experienced by UK employers, how it impacts on how businesses are run, and how employment services can work more effectively with employers, leading to better outcomes for individuals and the wider economy. The UK's main vehicle for ALMP, and flagship policy of recent welfare reforms is Universal Credit (UC). UC is the new working age benefit for those who are either out of work or on a low income. Under UC, social security for unemployed people is conditional on claimants demonstrating work search and other work-related activities. This is underpinned by a 'Work First' approach, emphasising high volumes of applications and fast work re-entry. It also potentially involves the extension of conditionality to those in work, blurring the traditional distinction between social security claimants who are in and outside of the paid labour market . Aims and objectives The project had four main aims. Through qualitative semi-structured interviews with employers, policymakers and other key stakeholders, this research project: 1. explored how UK ALMP is understood and experienced by employers 2. identified how ALMP impacts UK businesses, including how they recruit, retain and progress their staff (including differences between sectors) 3. explored how the impact of ALMP on employers varies in different low pay sectors 4. explored how the public employment service can work effectively with employers to lead to better employment outcomes for claimants The final project report is available via Related Resources. 
Type Of Material Database/Collection of data 
Year Produced 2023 
Provided To Others? Yes  
Impact Contribution to UK data service archives 
URL https://reshare.ukdataservice.ac.uk/856757/
 
Description Co-hosted event with Greater Manchester Chambers of Commerce 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach Regional
Primary Audience Industry/Business
Results and Impact 20 Greater Manchester employers and wider stakeholders from the employment and skills sector came together to reflect on Kickstart - a key active labour market policy for young people claiming Universal Credit. The event was a great opportunity to engage local stakeholders in discussion of this policy area, and was also an opportunity to promote the Universal Credit and Employers research project. The event has already (it was held today) led to new leads in relation to project recruitment, but also has helped to further build on and deepen connections with Greater Manchester Chambers of Commerce who are a key target stakeholder for this project. The event included a panel discussion with a Kickstart Gateway, a Kickstart Employer, a Kickstarter and a senior representative from the DWP.
Year(s) Of Engagement Activity 2022
URL https://www.eventbrite.co.uk/e/after-kickstart-the-employers-role-in-supporting-people-into-work-tic...
 
Description Contribution to Barnsley Pathways to Work Commission 
Form Of Engagement Activity A formal working group, expert panel or dialogue
Part Of Official Scheme? No
Geographic Reach Local
Primary Audience Policymakers/politicians
Results and Impact Bespoke briefing to Barnsley Council Pathways to Work Commission
Year(s) Of Engagement Activity 2024
 
Description ERSA Employer Engagement event 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Professional Practitioners
Results and Impact I presented key findings from the project at the ERSA Employer Engagement forum. This was followed by a presentation from the Growth Company, outlining how key recommendations had been put into practice. Following the event, the chief Executive added further positive reflections in an FE News blog https://www.fenews.co.uk/exclusive/working-for-better-work-prioritising-employers/
Year(s) Of Engagement Activity 2023
 
Description ESRC Festival event co-organised with Unite trade union 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Other audiences
Results and Impact Following their engagement with our UC and Employers research findings, we co-organised an ESRC Festival of Social Science event in collaboration with Unite trade union. This involved hosting a workshop, titled "Universal Credit as a Trade Union issue". This event shared research insights and policy debate relating to new conditionality rules for working UC claimants, considering how trade unions can best support workers impacted by these changes, and the trade union's broader role in influencing the policy development of policies which have huge implications for workers and organisations. The event included delegates representing five national trade unions and has prompted further collaboration relating to this policy across different trade unions. Following this Katy Jones was invited to present at an event in Parliament organised by Unite, the research also features in a Unite policy and campaign video.
Year(s) Of Engagement Activity 2023
 
Description Final findings launch event 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Policymakers/politicians
Results and Impact Just under 60 people attended this event to hear about the main findings from the UC and Employers project. I (Katy Jones, PI) delivered a presentation of key findings followed by a panel discussion, audience Q&A and networking. Prof Ashwin Kumar chaired the event and the panelists were Tony Wilson from the IES and Saira Hussain from the FSB. The findings sparked a lot of debate and discussion, and feedback from attendees was overwhelmingly positive. The event led to further invitations to present and share findings across the DWP in both policy and practice-based teams - see other entry for more detail), plans to host another solutions-focused event in collaboration with West Yorkshire Combined Authority and invitations to present at industry events later in the year (ERSA/Warehousing conference etc)
Year(s) Of Engagement Activity 2023
URL https://www.eventbrite.co.uk/e/universal-credit-and-employers-research-report-launch-tickets-4837203...
 
Description Findings event co-organised with West Yorkshire Combined Authority 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach Local
Primary Audience Policymakers/politicians
Results and Impact Following our successful findings launch event in Manchester, Katy Jones worked with colleagues at West Yorkshire Combined Authority and the Employment Related Service Association to co-host a local event in order to explore how to integrate key recommendations into local policy and practice
Year(s) Of Engagement Activity 2023
 
Description Greater Manchester Housing Providers Network Workshop 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach Regional
Primary Audience Professional Practitioners
Results and Impact We were invited to attend this workshop for housing practitioners interested in employment support to tell them about our research and see whether they were able to assist with recruitment. 15 practitioners attended, and this led to new contacts and follow up offers of support.
Year(s) Of Engagement Activity 2021
 
Description Invited attendee at Resolution Foundation roundtable 
Form Of Engagement Activity A formal working group, expert panel or dialogue
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Other audiences
Results and Impact Invited attendee at roundtable focused on Universal Credit, to feed in insights from the employers and UC project
Year(s) Of Engagement Activity 2024
 
Description Invited expert to CSJ Roundtable on Work and Opportunity 
Form Of Engagement Activity A formal working group, expert panel or dialogue
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Policymakers/politicians
Results and Impact Invited expert for CSJ Roundtable, at which I was able to feed in insight from the UC and EMployers project
Year(s) Of Engagement Activity 2023
 
Description Invited expert to IES commission evidence session 
Form Of Engagement Activity A formal working group, expert panel or dialogue
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Other audiences
Results and Impact Invited to give evidence to an evidence session focused on employers as part of the IES commission on the future of UK employment support. Evidence was cited in their interim report
Year(s) Of Engagement Activity 2023
 
Description Invited presentation at Efficiency North Forum 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach Regional
Primary Audience Professional Practitioners
Results and Impact We were invited to attend this workshop for practitioners interested in employment support to tell them about our research and see whether they were able to assist with recruitment. 31 attended, and this led to new contacts and follow up offers of support.
Year(s) Of Engagement Activity 2022
 
Description Invited to present to at a DWP workshop focused on employers and progression 
Form Of Engagement Activity A formal working group, expert panel or dialogue
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Policymakers/politicians
Results and Impact Presented findings relating to employer engagement across multiple DWP teams across policy and operations
Year(s) Of Engagement Activity 2024
 
Description Participation in Greater Manchester Work and Skills Forum 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach Regional
Primary Audience Professional Practitioners
Results and Impact We were invited to attend this workshop for employment support stakeholders from policy and practice to tell them about our research and see whether they were able to assist with recruitment. 60 practitioners attended, and this led to new contacts and follow up offers of support.
Year(s) Of Engagement Activity 2021
 
Description Presentation of findings to DWP In-Work Progression Leads 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Professional Practitioners
Results and Impact Invited presentation to DWP's new in post 'In-Work Progression Leads' following interest from launch event. This sparked questions and discussion, and further contacts regarding future related research projects. Feedback was that the research is very helpful for informing the development of the DWP's in work support in particular.
Year(s) Of Engagement Activity 2023
 
Description Presentation of findings to DWP analysis division 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Policymakers/politicians
Results and Impact Invited presentation to share emerging findings DWP Universal Credit Analysis Division. This sparked questions and discussion, and feedback helped us in finessing the final report. Feedback was that the research is very helpful for informing the development of the DWP's in work policy in particular. Following this, many participants also attended our findings launch in January 2023 and have championed our research in the Department.
Year(s) Of Engagement Activity 2023
 
Description Presentation of findings to DWP policy officials 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Policymakers/politicians
Results and Impact Invited presentation to DWP policy officials following interest from launch event. This sparked questions and discussion, and further contacts regarding future related research projects. Feedback was that the research is very helpful for informing the development of the DWP's in work policy in particular.
Year(s) Of Engagement Activity 2023
 
Description Presentation to Federation of Small Businesses West Yorkshire Academia-Industry networking event 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach Regional
Primary Audience Industry/Business
Results and Impact We were invited to attend and present at the Federation of Small Businesses West Yorkshire Academia-Industry networking event to tell them about our research and see whether they were able to assist with recruitment. 25 practitioners attended, and this led to new contacts and follow up offers of support.
Year(s) Of Engagement Activity 2022
 
Description Presentation to the IWLEX industry conference (Logistics Sector) 
Form Of Engagement Activity A talk or presentation
Part Of Official Scheme? No
Geographic Reach National
Primary Audience Industry/Business
Results and Impact I was invited by the chief executive of the UK Warehousing Association to present research findings at this industry leading event
Year(s) Of Engagement Activity 2023
 
Description Project launch event 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach Regional
Primary Audience Industry/Business
Results and Impact An online launch event to kick off the project - providing an overview and detailing how participants can get involved. The event was chaired by Elizabeth Taylor, CEO of the Employment Related Services Association (project partner) and Clive Memmott (Chief Executive of the Greater Manchester Chambers of Commerce) provided a response and encouraged employers to get involved. The event was well received, led to interest in the project and offers of support to help our recruitment efforts. A good relationship was established with GM Chambers, which subsequently led to further collaboration on a later event related to this project - "After Kickstart" (see other submission)
Year(s) Of Engagement Activity 2021