Poorest face toughest climb back out of unemployment post Covid19

@City&Guilds launch the Recovery and Resilience report

• 59% of people currently out of work state they cannot afford to pay for training: a lifeline into employment
• Lacking access to support networks and knowledge about where to access advice, those from lower social groups are likely to be further disadvantaged 

City & Guilds Group has today issued an urgent call on the Government to redirect billions of pounds of unspent and underutilised skills funding to help the newly unemployed get back into work as it releases new research on jobs and skills.

The Recovery and Resilience report, which includes a survey undertaken by YouGov for City & Guilds Group amongst 2,000 working and non-working adults in the UK, found that people from lower socio-economic groups were less likely to believe that they have the support needed to get a new job in several critical areas:

• Using support from my personal contacts –24% C2DE vs 35% ABC1
• Using support from previous employer –18% C2DE vs 28% ABC1
• Using support from a recruitment consultant –18% C2DE vs 29% ABC1
• In addition, 14% of respondents from lower socio-economic groups stated they just don’t know what to do to enable them to get a new job.

The report found that affordability was a key blocker preventing people from undertaking vital training and skills development to get back into employment. 33% of people from lower socio-economic backgrounds stated that they could not afford training and they are also less likely to know how to access funding to pay for a course (26%). These figures rise to 59% and 43% respectively amongst people who are already unemployed.

Unemployment is forecast to double to 4.5 million by the end of this year, with young people and those from lower socio-economic groups expected to bear the brunt of the fall. New analysis from economists at Emsi, included in today’s report, reveals that new job postings fell by 30% between February and May. According to analysis from Emsi, those from lower-socio economic groups work disproportionately in the industries thought to be most at risk of mass redundancies, such as retail, catering and hospitality. However, these worse-off groups are also less likely to be able to access the support structures that the more affluent can rely upon if they are made redundant.

Kirstie Donnelly MBE, CEO at City & Guilds Group, commented:

“As we get the country back on the road to recovery and set employment levels on the right trajectory, it is critical that we act now to provide lifelines for those most in need. From supporting those from lower socio-economic groups and young people who we know will be most badly impacted by the spike in unemployment through to supporting people from industries in decline as a result of the pandemic to retrain into new roles. 

“To counter the mass unemployment which, left unchecked, will scar the futures of a generation, we are calling on the Government to urgently redirect existing skills funding to ensure that the budgets set aside for further education are being allocated in the right way, with the right focus to support skills development that promotes social mobility. There is no more time to consult, we have both the means to make this happen and the evidence to prove how much it is needed. This is our ‘Act Now’ moment.”

Rob Halfon, MP, Chair of the House of Commons Education Select Committee added:

“The impact of Covid-19 risks severely stifling our economy and exacerbating disadvantages in this country. The Prime Minister’s recent announcement guaranteeing an apprenticeship for every young person is hugely exciting, but we must also do more to ensure that everyone around the UK has the chance to retrain, re-skill and find employment. To achieve this, the correct allocation of funds and investment in apprenticeships, FE and skills must be the number one priority for the Chancellor.” 

“As well as unlocking underused, existing skills funding, I am calling on the Government to introduce a skills tax credit to offer to companies who take on the unemployed or those from disadvantaged backgrounds. We must offer businesses support and incentives to invest in the people who need it most and give them a chance to climb the skills ladder of opportunity – and, at the same time, help meet this country’s skills needs.” 

With the skills needed for the jobs that are available also changing in light of new ways of working and new technologies, the research also finds that people have a worrying lack of awareness about what training would be most beneficial: a fifth (18%) of all workers – and 25% of the unemployed – are unsure of the skills or qualifications they need in order to find a new role.

The three main recommendations outlined in the report are:                   

1. Urgently redirect existing skills funding to save us from losing a whole generation of lost workers:
   • Release £3bn of unspent National Skills Fund (NSF) to support post-Covid reskilling
   • Broaden the Adult Education Budget criteria to support bite-sized, online and flexible learning to quickly retrain people back into work
   • Extend Apprenticeship Levy funds to support traineeships and use any underspent levy to pay apprentices wages in the short term, focused on younger apprentices who are more likely to be unemployed
2. A call on employers and education providers to work together to forefront digital transformation through digital skills investment and online learning tools, with the right investment from Government to allow this to happen.
3. Use some of the NSF to create ‘Lifelong Learning & Employment Hubs’ within the regional areas most impacted by unemployment to act as a ‘one-stop-skills-and-jobs-shop’, to support reskilling back into meaningful employment.