Does Workfare lead to better outcomes and less poverty? Chris Goulden examines the evidence.
Workfare has recently come under close scrutiny, and criticism aimed at some high-profile employers has culminated in a terse response from the Government.
Detractors condemn workfare as barely better than slave labour, while defenders claim it's a valuable addition to other forms of help for unemployed people, but what does the evidence say about whether workfare leads to better outcomes and less poverty?
DWP commissioned a research review back in 2008 to look at the evidence from the USA, Canada and Australia on their workfare schemes. The conclusions are pretty stark:
"There is little evidence that workfare increases the likelihood of finding work. It can even reduce employment chances by limiting the time available for job search and by failing to provide the skills and experience valued by employers. Subsidised ('transitional') job schemes that pay a wage can be more effective in raising employment levels than 'work for benefit' programmes. Workfare is least effective in getting people into jobs in weak labour markets where unemployment is high."
Paul Gregg examined the role of workfare when he was commissioned by the last UK Government to look at conditionality and the JSA regime. He concluded that policy makers should consider "...how to deliver work experience programmes, particularly for those further from the labour market. These need to build in help with job search and wider support rather than be delivered as a pure Workfare type scheme".
Work placements coupled with the additional support and assistance required to help individuals move into mainstream employment would better tackle the barriers faced by the most disadvantaged individuals. This is supported by a JRF review by Dan Finn, who found that Dutch workfare, as part of a wider package of support, "cut costs and increased the number of social assistance claimants leaving benefits and entering employment."
So, the evidence suggests that providing people with a full package of support and the right kind of work experience – ideally with additional pay and the hope of a job at the end of it – is crucial.
Workfare alone is not enough, and discussion so far has largely ignored the wider problem of the quality of jobs in the UK labour market. We know that low-paid, insecure work isn't the solution. Getting on the ladder is vital but we need better and wider routes upwards.