The demand-side of active labour market policies: A regional study of employer engagement in the work programme

AbstractIn 2011, the UK Coalition government introduced its flagship welfare-to-work programme, ‘The Work Programme’ (WP). Based on a ‘payment by results’ model, it aims to incentivise contracted providers to move participants into sustained employment. Employer involvement is central to the programme's success and this paper explores the ‘two faces’ of this neglected dimension of active labour market policy (ALMP) analysis: employer involvement with the programme and the engagement between providers and employers. This paper draws empirically from a regional survey of primarily private and third sector SMEs, and from interviews with providers and stakeholders about provider engagement with SMEs and large employers. Findings indicate that SMEs had recruited few staff through the WP and had little awareness of it, and that providers engaged in intense competition to access both SMEs and large employers. Employers are critical to the success of ALMPs, but an underpinning supply-side ideology and a regulatory context in which business interest associations are weak policy actors means that their involvement is based on implicit and flawed assumptions about employers’ interests and their propensity to engage.