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Labour market

Employment rates in the UK have been relatively high over the past decade but unemployment is now rising and has accelerated in recent months as a result of the economic downturn. It is predicted to continue to rise considerably over the next year, with forecasts ranging from 1.57m to 3.1m for the end of 2010. [1] However, although, there are signs of economic recovery and the numbers of unemployed have yet not reached as high as originally feared due to flexibility in the labour market, the public sector recession and its resulting job cuts, as one of the largest employers in the UK, is probably still to come. There is also increasing competition for jobs as a result of global connections between markets and population movements. Britain has also moved from a low to a high-skilled knowledge-based labour market as a result of the shift from manufacturing to financial and business services.

What are the implications?

• Unemployment may ease a relatively tight VCS labour market and the upwards pressure this has put on salary costs.
• There may be an increase in people from the other financial sectors and careers coming to work in the VCS as a result of a larger labour pool or if values of social justice become more important in a downturn (see importance of organisational values).
• Increased competition for jobs may lead individuals to develop additional skills which may ease skills gaps in all sectors as well as the VCS.
• Large number of school and university leavers are likely to have particular difficulty finding work, especially given already high levels of youth unemployment.
• Pressure on organisations that work with unemployed people to develop their skills and help them into work.
• However, there is a risk that the current strict government agenda around ‘worklessness’ which the VCS is often involved in delivering may become challenging to deliver in a period of rising unemployment.
• Levels of volunteering may increase if people turn to volunteering as a way of spending their time and developing skills.
• As unemployment rises, levels of poverty and inequality are likely to rise which is likely to create more demand for the services of VCOs.
• A decrease in levels of consumer spending and possibly levels of individual giving as people have less disposable income.

Moving forward

• How can your organisation help your beneficiaries to develop their skills and enter work, if this is what they want to do?
• In what ways can you ensure that government policies and benefit systems solely aimed at getting people back in to work take into account the multiplicity of issues why people are not in work and do not disadvantage already marginalised and vulnerable groups of people?

With levels of poverty and inequality likely to increase as a result of rising unemployment, the VCS may face a rise in demand for their services. 

• How can your organisation support people who suddenly find themselves unemployed and unable to support themselves or their dependents?

How can you take advantage of the increase in skilled employees available?  Do you need to re-assess your employment practices? (e.g. how you recruit and advertise posts)

There may be potential increase in the number of skilled people volunteering. 

• How can you attract these people to your organisation?
• How do you ensure that volunteers in your organisation are used appropriately in a way that values, supports and develops their skills?

Is there a role for the sector in helping people back into work through volunteering?

Want to know more?

Building a better balanced UK economy

Published by: IPPR

Date: July 2009

Format: PDF

What is it? This substantial report attempts to identify where new jobs are likely to emerge in the future. It identifies the current structure of UK employment, discusses the trends over the last eight years and looks at how employment is likely to develop in the next economic cycle.

How useful is this? This is a useful report for identifying key issues and obtaining a general impression of how employment is changing. The latter half is directed more at government so may be of less interest to many VCOs.

Other comments:

The changing pattern of earnings: employees, migrants and low-paid families

Published by: Joseph Rowntree Foundation (JRF)

Date: October 2008

Format: PDF

What is it? This short report discusses “the assumption that individuals can work themselves out of poverty”. It is based on longitudinal data from the Lifetime Labour Market Database.

How useful is this? Based on longitudinal data recorded over three decades, this report is useful for analysing trends.Unfortunately, the PDF available online is too short to give more than a brief discussion, although this does make the results very accessible.

Other comments:

No way to start out in life

Published by: The Economist, a monthly current affairs magazine, favouring free market economics

Date: July 2009

Format: Web

What is it? This article focuses on the labour market situation for younger people. It presents key data and an intelligent discussion of the key issues.

How useful is this? Although this article is clearly of particular interest in organisations working with younger people, it certainly has a broader relevance. As the article notes, the plight of the “lost generation” is also of particular relevance to crime and to civil society more widely.

Other comments: 

References

1. Forecasts for the UK economy: A comparison of independent forecasts. June 2009 (HM Treasury, 2009) [back]