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There is a significant gap of 14.2% between the employment rate of ethnic minorities and that of the general population. Annually, this costs some £1.3 billion in benefits and lost tax revenue, and some £7.3 billion to the UK economy in lost output. The employment gap has changed little in 20 years and is only 1.3% lower than in 1987. The Department for Work and Pensions (the Department) is responsible for helping ethnic minorities into employment, largely through a range of services provided by Jobcentre Plus offices across the country.
Since 2002, the Department's strategy for helping ethnic minorities into employment has lacked continuity, consisting largely of short term pilot projects which had insufficient time to be fully effective and have mainly been discontinued. This stop-start approach has had an adverse impact on Jobcentre Plus's efforts to increase ethnic minority employment.
Since 2006, the Department has shifted its focus to the City Strategy initiative, which is aimed at the wider disadvantaged community. The Department has devolved decision making to 15 City Strategy pathfinders. The pathfinders cover 40% of the ethnic minority population, but City Strategies have not appropriately targeted the local ethnic minority community. As a result, there is a real risk that the needs of ethnic minorities will not be addressed, and the Department's initiative will have limited impact on their employment opportunities.
Jobcentre Plus personal advisers play a crucial role, both in getting ethnic minorities into employment and moving them closer to the labour market. The advisers are, however, under considerable pressures, which limit the time they are able to spend with customers and their ability to access training and good practice. The constraints impact on their morale and effectiveness and have serious consequences for ethnic minorities, many of whom have multiple barriers to employment. Whilst the Department provides basic training and publishes good practice internally, this is of limited use if personal advisers do not have time to access it. In addition, outreach activities undertaken by personal advisers to bring the economically inactive ethnic minorities closer to employment are, in many cases, being scaled back. This has the potential, not only to isolate those members of the ethnic minority community who most need help, but also to alienate the voluntary sector organisations who have worked closely with Jobcentre Plus to get to this hard to reach group.
New Deal is the Department's mainstream initiative for getting people into work, but the quality of some of its training courses is variable. In particular, some ethnic minority customers finish their English for Speakers of Other Languages course with the same level of language skills with which they started.
On the basis of a Report by the Comptroller and Auditor General,[1] we took evidence from the Department for Work and Pensions and Jobcentre Plus on their efforts to increase ethnic minority employment and reduce the employment gap between ethnic minorities and the overall population.
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