Supplementary memorandum submitted by
the British Retail Consortium (ES 15A)
Employment Support Services (Q2, Mr Kirkwood)
In addition to Ms Rosewell's answer, we would
add that local delivery is not assisted by inconsistent policy
application. This manifests itself in two ways. The proliferation
of agencies and arms of Government with local remits, both within
England (47 Learning & Skills Councils and eight Regional
Development Agencies) and their Scottish, Welsh and Northern Irish
non-equivalents works against a co-ordinated and consistent delivery
of Government programmes. Larger retail companies (who have the
most employees and whose growth creates the most new jobs) are
dissuaded from engagement with such programmes, unless like Ambition
Retail there is clear national impetus behind it.
Furthermore, the subtle distinction between
many of these government organisations confuses and ultimately
devalues the overall economic goal. For example, jobcentres may
have developed, and constantly seek to improve, their links with
the retail sector because of its size, growth trend and employment
opportunities, but local Workforce Development Plans tend to value
manufacturing and IT skills as priority development areas above
retail/business/management skills despite the latter's greater
bottom line effect on the performance of UK plc.
DFES Ministers' recent decision to establish
Sector Skills Councils is a positive signal that the demand side
(employers) must be played into this equation. The BRC is delighted
that its proposal to establish a retail SSC was one of the first
five approved. But as Skillsmart (the retail SSC) and the other
four SSC's have already encountered, there is a huge emphasis
on Government funding for supply side initiatives without equal
support for the demand side. The BRC and Skillsmart would be delighted
to work with the Committee in seeking ways to align the supply
side Government programmes to employer needs.
Middle term growth of job opportunities (Q4, Mr
The retail sector continues to grow, although
the pace of growth is slowing as the sector emerges from an unprecedented
growth period. In terms of jobs the sector has grown by an average
of 5 per cent a year over the last five years (an average of 100,000
new jobs a year). This is despite the burden of dealing with the
implementation of many significant pieces of employment and business
regulation over the same period. The speed and volume of new legislation,
coupled with the one off implementation costs, have probably been
as big a burden as the cumulative additional cost. There is no
doubt that growth has been restricted, and the effects will be
probably been more keenly seen in the medium term.
The situation has been exacerbated by associated
Regulatory Impact Assessments for many of these regulations, many
of which have been woefully inadequate in their analysis of cost
The BRC would, therefore, forecast that the
service sector will continue to grow in comparison to manufacturing,
but that the rate of growth will be subject to further government
regulation. For example the forthcoming regulations in relation
to pensions and the employment circumstances of agency workers
will adversely affect employment patterns.
Job entry rate of welfare to work programmes (Q9,
Welfare to work programmes are designed primarily
for social rather than economic reasons or as a solution to employment
needs. However they rely upon employment opportunities to succeed.
In terms of investment by an employer they are
a highly uneconomic means of recruitment. Many retail employers,
for example, reported the costs of administering New Deal far
outweighed the benefit. Employers will inevitably select better
skilled, more literate and numerate recruits when there is a well-qualified
labour market to select from. To that extent, welfare to work
programmes are subject to the economic cycle.
Effect of Welfare to work programmes (Q10, Mr
Welfare to work programmes perform an essentially
social function. It is more economically effective to channel
resources towards assisting those out of work who are most appropriately
skilled back into employment, than assisting those with least
skills. But the political and social imperative of assisting the
most needy in society outweighs the economic arguments. Therefore,
the entirely laudable goals of welfare to work programmes are
not primarily to have a major economic effect, nor do they. However,
as Ms Rosewell remarks, at a micro level the effect is much more
Attracting a workforce (Q12 /13, Mr Dismore)
As Ms Rosewell points out, willingness is a
key issue, but it is extremely difficult to instil willingness.
Clearly employers and trade associations are
responsible for improving the attractiveness of their own sectors.
For retail this is a key area of activity that Skillsmart, (the
new Sector Skills Council for retail) will be engaging.
In our own case, we need to improve understanding
of the variety of opportunities that are available and the career
development prospects. In many entry-level retail jobs, hours
can be anti-social and pay is comparatively low. But retailers
are amongst the most flexible employers and the package and prospects
for recruits with potential are very competitive.
As employers we would like to see Government
action to improve the standard and reputation of vocational qualifications.
There is much to be gained by promoting a viable and credible
alternative to academic qualifications. It is important that those
who under-achieve under compulsory academic education do not leave
school at 16 with a stigma that they have no talent or route for
self-improvement. This would require intervention before an individual
has completed compulsory education.
Ultimately employers value quick learners who
are reliable. There is perhaps a role for Government in shaping
the expectations and understanding of what work is about for people
that are about to take up employment for the first time.
Head of Parliamentary Affairs
20 May 2002