This report investigates the early effects of the recent economic downturn on the welfare to work infrastructure in deprived areas, in particular how it is able to continue to provide support to the most disadvantaged groups. The report provides context that will inform the Department for Work and Pensions and Jobcentre Plus’ response to the recent (and future) recessions in relation to support for disadvantaged areas and groups. The evidence presented also functions as a qualitative baseline against which the perceived success, within deprived areas, of measures to minimise the long-term impacts of the recession (e.g. the Young Person’s Guarantee) can be considered.
The qualitative research suggested that there is a general perception that as the labour market effects of the economic downturn unfold, those social groups facing any kind of additional (and especially multiple) disadvantage will be pushed progressively further away from the realistic prospect of labour market participation. This finding was shared across all groups and resulted from a combination of a loss of employers willing to be engaged in labour market programmes targeted at these groups, and crowding out by increased competition for those vacancies that do exist. The majority of respondents based these comments on assumptions rather than evidence but there were cases where examples of employer withdrawal from programmes and placement projects were noted.