Examination of Witnesses (Questions 180
- 199)
WEDNESDAY 5 JULY 2000
MS CANDY
MUNRO, MR
JONATHAN BALDREY
AND MR
WILLIAM ROE
180. That is fine.
(Mr Baldrey) At the moment we are in London. We operate
from six high street shop front premises which we use to attract
people into our branches. Something unusual about Talent is that
candidates are not referred from Job Centres, we operate in areas
of high unemployment but people walk through the door because
they want a job. We have a strong sales focus which talks to employers.
In each branch we have as many people talking to employers as
we have people talking to jobseekers.
181. Yes.
(Mr Baldrey) We have commissioned paid sales staff
who talk to employers and we put a very strong emphasis on selling
our service to companies. We develop preferred supply relationship
in a similar way to a recruitment agency. The service is very
much about getting unemployed people into jobs. 72 per cent of
our candidates are from minority ethnic groups. About 90 per cent
are unemployed as they walk through the door, 15 per cent have
disabilities, so we are working with a hard to help group. The
emphasis is very much on getting a job. We place at the moment
about 2,000 people each year into jobs and the majority of them,
about 70 per cent at the last measurement, are retaining jobs
at the six months job or are still in employment. How we measure
success is very much to do with a lot of soft factors. I think
recruitment to me has always been about individuals and individual
employers. I think trying to have one measurement of success is
very difficult so I think we try to look at almost does it feel
right? Are the right candidates retaining jobs? Are candidates
you expected to retain jobs retaining jobs? We look at factors
by whether candidates say they were happy with our service because
that is a very important indication. We look at repeat business
from employers, whether employers come back and use us again.
We look at crude measures such as volume. We look at a whole basket
of indicators to see how well we are doing.
182. Thank you. William?
(Mr Roe) My role is really quite different. I do not
manage or run anything in this field but I have for a longer number
of years than I care to remember been involved in inventing and
designing programmes and processes for tackling employment and
evaluating things that sometimes work and sometimes do not. Coming
here today I was remembering when I first got into this, which
was in the mid 1970s, but you will realise how long ago that was
if I tell you there was a conference in 1978 in the Stock Exchange
of all places called The Challenge of Tackling Long Term Unemployment.
The stars were Tom King, who moved on to other things, Sir Nicholas
Goodison, who also has, Sir Jeremy Beecham, who also has, and
myself. So I have kind of stuck with this while the others have
gone on to great and high and mighty things. I have been involved
in designing systems and programmes and solutions for all economic
and labour market changes you have seen for 20 or so years including
major industrial closures in steel areas and shipbuilding areas
and textile areas. Then later in helping design or evaluate all
the succession of programmes we can all remember from the Job
Creation Programme onwards. More recently, in the last three or
four years, I have been increasingly involved with the development
of Government policy and welfare in work areas, most recently
in the field of demand-led strategies and intermediary systems,
which I explored both in this country and the United States. The
particular value that I might be able to offer today is around
work that we are currently doing in Edinburgh with major employers,
around how their interests can be met in an ever-tightening labour
market. Unemployment in Edinburgh has fallen by two thirds in
five years and the economy is quite hot. A lot of large companies,
which still have a lot of expansion to do, are getting quite anxious
as to where they are going to find their future workforce. They
have come together, a number of them, major blue-chip companies
and others, to look at how they can reach deeper into the labour
market in the southeast of Scotland. Reaching deeper means reaching
a more diverse workforce and making use of recruiting, between
people who have been out of the labour market for a long time,
or never in it, or people who do not think they could get into
these kind of jobs. We have been working for eight or nine months
on the development of what aspires to become a centre of excellence—I
use these words carefully—in access to employment and in
learning and advancement for existing workers. The centre of excellence
that is now being created is designed to meet employers' needs,
to find a successful workforce that they can retain but also to
offer the employers of the same companies opportunities for professional
development training and advancement. The design of the centre
of excellence is turning out to be very interesting. It is at
the highest end of our expectations. When we embarked on this
we were not at all sure that many of the companies would stick
with it or want to see it through. The responses we have had have
been at the higher end of our expectations. The onus is shifting
from the inventors and designers, as it should, to the companies
who are going to be the main players, investors and beneficiaries
of this.
Ms Atherton
183. The Government has employed the services
of Wildcat, an American company, to kick-start an intermediary
programme in East London and some ten big companies are involved.
Why do you think it took an American company and the Government
to kick-start this? Why did it not emerge naturally within this
country if there is a market out there? What is your reaction?
(Ms Munro) My initial reaction is that there are pockets
of what Wildcat has been doing—I am familiar with the Wildcat
model—up and down the country, but it just has not come
to the Government's attention in the same way that Wildcat has.
How that has come about I am not entirely sure. I think there
are some really good examples of best practice.
184. Why was it not brought to the Government's
attention? Why did the Government not notice it?
(Mr Baldrey) I will second what Candy says, but I
think there is a massive lack of knowledge from Government in
terms of what works. Government has a very fragmented relationship
with organisations such as mine and, I assume, such as Candy's.
We have to compete for funds from the local funding agencies and
local organisations, such as local authorities, City Challenges
and SRB companies who, in turn, get their money through Government
offices and subsequently up the chain to the departments. I think
it is very anecdotal. I hate to say this, but I do think it was
probably because somebody in Government knew Wildcat, and it was
easier to use Wildcat than to look for somebody in the United
Kingdom. Certainly Government is fully aware of organisations
such as mine and such as Candy's, I suspect. We were just talking
outside of how we are constantly plagued with organisations trying
to case-study us. I think there are loads doing what we are doing
that nobody has ever heard of but they are equally good.
Chairman: Can I follow that on by asking—I
am asking the clerk and our advisers—do we have a bank of
best practice here? If not, perhaps Candy and her other colleagues
might be able to provide us with more examples. We will probably
talk more with you about that.
Mr Nicholls
185. What qualities does an intermediary need
to display in order to be effective in developing a demand-led
strategy and in order to be attractive to employers in the first
place? What are the talents that the intermediary needs?
(Mr Baldrey) I think it is interesting that Candy
was a recruiter before and I was a recruiter. I think that recruiters
seem to be the best intermediaries because you are brought up
on the idea of treating employers as important, not as a means
to an end.
186. You have that confidence.
(Mr Baldrey) Yes. You also now how to talk commercially
to commercial organisations. Most intermediaries say it is impossible
to do business with the public sector, it is impossible to place
people in the public sector.
Chairman
187. Say that again?
(Mr Baldrey) We found it impossible to place people
into the public sector.
188. Could you just elaborate on that a little
more? That is very interesting.
(Mr Baldrey) Yes. It is to do with equal opportunities
policies. If you take most of our candidates, on paper they do
not look very good. They do not have qualifications, they do not
have experience. Local authorities always say we have to advertise
every vacancy that we have in the newspaper and you must fill
in an application form and you must be interviewed in a committee
similar to this. Firstly, our candidates are scared of completing
application forms, secondly they will not answer an advert and
thirdly, our staff will not touch it because it takes six or eight
weeks to get an interview, that is if you do get one.
Mr Nicholls
189. The perception might be hard-hearted, hard-nosed
employers trying to turn an honest into a dishonest buck, would
not co-operate with people who do need a helping hand, where as
touchy-touchy, feely, fluffy public institutions might be welcoming
with open arms.
(Mr Baldrey) I think the public sector has become
very, very commercial these days, it has had to do. It has made
several people redundant, I do not think they are recruiting.
They are not overstaffed. We do not touch the public sector. We
work with a lot of privatised companies and we find they are very
good to work with because they suddenly wash away all of the public
sector for recruitment mechanisms and start to do things. We can
ring up and say, "We have somebody, they are good for you.
Will you see them". It is a lot to do with relationship building
and the employer trusting you. We know we are getting it right
when the employer says, X, Y, Z knows the sort of staff I want.
"I want to deal with Jane because Jane understands my business
and Jane knows what I want. If Jane says I should see this person
I will see them".
190. Would you ever make a social pitch? Do
you ever say to the employer, "This would earn you some brownie
points if we send Peter, but we are not absolutely certain he
is going to be right for you", or would you have to be far
more hard-nosed than that?
(Mr Baldrey) You do with 16 year olds sometimes. To
be honest, we are quite hard sales people. Try and place a 16
year old with a middle-aged woman, you can say, "Do you have
a son or a daughter? Do you know how difficult it is to get a
job when you are 16 these days? It could be your son". You
might do a bit of emotional blackmail. I would never ring up an
employer and say, "This candidate has been on the dole for
the last four years, he has a criminal record, he has not worked,
he has no skills, he has no qualifications, please will you see
him for an interview. I will give a £60 subsidy if you take
him on because he is that bad", because the employers just
says no. We are placing New Dealers. We have only just started
placing New Dealers. We are finding we can place New Dealers with
employers and employers are saying, "We are not making a
big song and dance about the fact they are New Dealers, we are
stressing they are employable people".
Chairman
191. Yet the Chamber of Commerce told us that
they thought the subsidy was pretty dispensable with most of their
clients, however that is another question. We have been told that
there are only a few intermediary organisations in the United
Kingdom that are capable of developing and implementing demand-led
strategies, do you agree with that?
(Ms Munro) No. Picking up the point earlier on, there
is a whole range of intermediaries displaying best practice that
can, with a bit of capacity building, step up and display the
characteristics which have been previously identified in the New
Deal Task Force report. I think it is organisations like ourselves
that are increasingly operating on a commercial basis and saying
"Yes, we do serve the needs of dual customers but it is the
needs of the employer that must come first". To a number
of intermediary organisations that is a difficult concept to grasp
because they have come through usually a number of programmes,
Welfare to Work and previous programmes, where the needs of the
jobseeker were paramount. In actual fact, we need to turn that
round. I think there are a whole range of organisations that can
display these characteristics.
(Mr Roe) We are really at the turning point, we have
had a whole generation of policies and programmes and practices
and people of my age who have grown up their whole professional
lives doing things in a certain kind of way until quite recently.
There have been forerunners or outriders of new ways of working
for three years now. Essentially a whole generation of people
and programmes and civil servants and others have grown up seeing
all this as the problem of unemployment. All of the programmes
have been around helping unemployed people make progress.
Chairman
192. Yes.
(Mr Roe) No public programme until right now has even
attempted to be demand-led or responsive to the business needs
of employers. It is not surprising that it is hard to turn this
big ship around and for people to see things from a different
perspective. That is really why this is quite hard. It is not
impossible. You asked about characteristics of successful intermediaries
and whether existing organisations could develop into becoming
successful intermediaries. I think there are many organisations
which could develop into becoming successful intermediaries. I
think there are a limited number who are but I think the truth
of it is that for many organisations who depend on public contracts
or public grants and scrutiny and proper accountability that go
with it, the things which get counted through many of these programmes
do not help organisations be demand-led, they help them to be
supply side led, they help them to place the largest number into
jobs. That has been the case until very recently, it is now changing.
It is only in the last 15 months that most people have begun to
use the words "recruitment" and "retention"
in the same sentence, or "recruitment", "retention"
and "progression" in the same phrase. That is why this
is an absolutely important turning point. I have no doubt if I
look back and look currently and look forward that certainly in
those parts of the country where the labour market is tight or
tightening, demand-led systems have a very big part to play. There
are problems back down the system in the supply chain, if you
like, that make it hard for this to come alive very quickly. What
I find is if you think of the number of people paid for by public
money usually who interact with unemployed people, young people
who are unemployed, lots and lots of them, community workers and
social education workers and others, have not really come to terms
with this change that I am talking about. Much of the advice and
many of the steers that young people and other unemployed people
are getting is from advisers, including sometimes professional
careers advisers, who have not got it, who have not got the message
and who are sending quite counter cultural and counter economic
signals to people and making it hard for those who are the kinds
of intermediaries we are talking about today to be successful.
This is very turbulent because of the big changes that are going
on and in a turbulent time we look, as you are doing, for some
front runners showing the way forward. I think the Government
is ambivalent about this.
193. Tell us more. You think the Government
is ambivalent, which bits of the Government are facing in which
different directions would you say?
(Mr Roe) The thrust about being demand-led is seen
by some people as okay for hot labour market areas and okay for
people who would make it anyway.
194. Right.
(Mr Roe) Some people say that demand-led strategy
will separate the more likely people to succeed from the less
likely to succeed and it will be more divisive than unified. I
do not buy that line. I see why people say that but I do not buy
that line because ultimately why would you want to place a hard
to place person into a job in which they were not a good fit?
Why would you want to do that? Why do so many placements simply
not work and last, because there has not been a sophisticated
careful process of matching. If I had to leave you with one word
today it would be about matching. You do whatever it takes to
match. You nurture this side and you understand this side until
you can find a match.
Mr Brady
195. You think a demand-led strategy is just
as relevant and applicable in a slack labour market as in a tight
one?
(Mr Roe) Absolutely, but we cannot apply it in quite
the same way. The levers you have, the power you have, the ways
you can do it are not necessarily as fast or easy. I just ask
the question why would you want to place somebody into a job when
it is hopeless for them and hopeless for the employer taking them
on, it will not work.
(Mr Baldrey) Can I just pick up on that. I fully support
what has just been said, which is good. I think I would be a bit
more cynical about it than that. I think that is maybe because
we are a profit making company. I am quite surprised we have not
got bricks through our windows because when the Government has
had to say to organisations "things are going to change,
we are not going to treat unemployed people as being some walking
wounded who need curing, we will talk to employers" two things
have happened. Firstly, everybody has decided that they are called
an intermediary now and the whole world has decided that they
are intermediaries. We are getting colleges, for example, that
are suddenly calling themselves intermediaries and they are not.
I think that is very dangerous because suddenly everyone is saying
to employers "Hey, we are an intermediary and we are good
at talking to you". They are not. I think, secondly, the
money that comes down from Government -this is the point I made
earlier I think—comes down from Government and it goes out
to local organisations but at a local level I know that people
like DfEE have been quite aware of almost cartels that have been
operating at the local levels.
Chairman
196. That is a fascinating use of the word.
Can you just clarify it a bit? That sounds intriguing, this new
word "cartel".
(Mr Baldrey) Okay. When New Deal came in, for example,
we had the FT ET option.
197. Right.
(Mr Baldrey) The usual suspects took the contracts
for the FT ET option.
198. Further education colleges?
(Mr Baldrey) Yes. The colleges almost said "We
are the college therefore we have this one million pounds worth
of provision". There was almost no question. We are seeing
it happen with the LSCs already that the colleges are saying "Well,
there are 12 positions and there are two colleges, that is 6 each
and there is a million pounds to spend so that is 500k each".
It is all done and dusted. It is almost like there is no question
at the local level but "we are a college, therefore we will
provide this service".
199. Yes.
(Mr Baldrey) I think what happens is bringing something
new like the intermediary, you get organisations at the local
level who are saying "Look, there is money here or the Government
is changing the rules, guys, so we have to call ourselves something
else. We have to be good". There has been a lot of that.
I have seen a lot of things that we know are working. We know
that some of the courses we run for long term unemployed have
been absolutely atrocious in terms of moving them further away
from a job than they were before. The comments that have been
made about my organisations sometimes have been quite disturbing
to me that we just find people jobs, for example, and we are not
helping people because we are just placing them into a job. Or
a comment that was made recently was that we had something like
700 young black men who had all been unemployed and we were told
they were easy candidates to place. I think the problem is that
if we give them some rubbish qualification like an NVQ level 1,
which will take three weeks to get, we will suddenly be seen as
good. I think there is a lot of that going on and we cannot pretend
that is not happening. I got a hint of that in what you were both
saying but I wanted to get that on the table.
Chairman: Thank you. That was very helpful.
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