Presentation from the Economic Development Team.
Minutes:
6.1 Representatives from the Business Improvement District Group, spoke to the sub-committee about the new initiatives being developed to assist Southwark people into local jobs.
6.2 Peter Williams said that they were focusing on the economic regeneration across the borough as a way to seek out new employment possibilities. Although Southwark had been relatively good at creating jobs, it was thought that there was still some way to go before the numbers of local people being taken on to fill Southwark vacancies could increase. There were currently around 29,000 jobs in Southwark with 60,000 of those in Bankside. Given the growth, it was not yet understood why unemployment was so high in the borough.
6.3 95% of businesses had undertaken recruitment within their organisations, Other businesses in the area had tended to use employment agencies to source workers.
6.4 In the push to assist more Southwark jobseekers into work, Peter Williams said that after some research, he had found that 57% of businesses in the borough would be willing to recruit from the local population. These businesses had signed up to a ‘pledge’ to consider local people before recruiting outside the borough.
6.5 Peter Williams said that they had been working on a three step solution:
- To recruit employers through the employers ‘accord’ (ensuring their loyalty to the scheme)
- To award employers with a charter mark which employers would sign up to, to ensure they use local job applicants first.
- To advertise vacancies on the new website
6.6 Up to £25,000 year had gone into this initiative. The new website had been advertising many vacancies. with approximately 104 vacancies available in the SE1 area. The target was to increase the number of employers currently using the site from around 30 to 40 in the near future.
6.7 Business which seem to have the highest positions vacant, had tended to be in hospitality and catering. It was expected that the number of these positions would rise further in the run up to and during the time of the Olympics and it was expected that these positions would be advertised on the SE1 website.
6.8 Currently, there were 10 ‘live’ companies who had vacancies advertised on the website and only a job seeker registered as a Southwark resident was able to access the SE1 website. The companies advertising the vacancy were obliged to see Southwark candidates before recruiting elsewhere. Awarding a charter mark to employers in the scheme, had added an incentive to ensure that Southwark candidates and companies were put together first.
6.9 Graham Sutton then presented on the employment situation in Southwark.
6.10 The Southwark business base had an increase of 35% which was creating 21,600 additional jobs – a 15% increase. However the rates of worklessness remained high and tend to be concentrated in demographic groups in specific geographical areas. This had shadowed the general pattern of deprivation in the borough.
6.11 The national policy of welfare reform had meant that there had been a shift from a passive to an active benefit claim pathways, helping to make work become a more attractive option. This involved increasing the conditions for the receipt of out of work benefits.
6.12 A new DWP delivery and commissioning model launch of the Work Programme was unveiled in June 2011. Graham Sutton said that there were three ‘prime contractor’ delivery networks, competing across London East (17 boroughs) over seven years. There was a mandatory referral process employed by Jobcentre Plus according to the claimant group. The claimant groups were:
- 25 yrs plus jobseekers after 12 months
- earlier referrals for young people and disadvantaged groups such as NEETs and offenders/ex-offenders.
6.13 There were staged payments by results and the majority of the payment for each client depended on the completion of sustained employment over a 2 year period.
6.14 There had been a removal of local funding for commissioning employment and enterprise schemes. However, Graham Sutton said that the highlights of the year 2011 – 12 had been:
- 75 new business start-ups in 2010/11
- 15 in 2011-12
- 462 people into jobs for 6 months + in 2010/2011
- 127 in 2011-12
6.15 The Southwark Local Economy Group’s strategic priorities had been to enhance the partnership of the main providers of employment support, adult vocational training, business/employer representatives - Jobcentre Plus, 3 DWP Work Programme providers, Southwark College, Skills Funding Agency, BIDs, LSBU and local business support agencies.
The aim has been to:
- Remove the barriers to work faced by priority groups
- Increase business and employer engagement
- Raise skills for sustained employment
6.16 In recent years employment rates have been steadily decreasing. Southwark has been the second most deprived population in London in 2007 and became the fourth in 2010. The employment rate increased in 2007 from 64% to 67.2% in 2011. The unemployment rate has been at 10.5% (London 9.1%; National 7.7%). Of 29,980 working age residents, 14.2% claim an out of work benefit. However the gap has narrowed and Southwark have been maintaining a good performance despite the recession.
6.17 Out of work benefit claims had risen since 2008 - 2011 with an increase of a 60 % rise in unemployment rates. The long term unemployed, measured by the rate of Jobseekers Allowance claims over 12 months, rose by 100% in the same period.
6.18 The characteristics of the unemployed were measured by Ethnicity:
- Ethnic minority employment rate is 64.5%
- Compared to White grouping at 73.1%
- Black or Black British Group is 60.2%
- Economic inactivity rate is 22.7% for ethnic minority group
- Compared to 21.2% for White grouping
- Black or Black British – 20.2%
6.19 With regard to health and disability, it was found that Southwark had the highest claim rate. 48% of those claimants had mental health issues. There were 13,440 claiming either Incapacity Benefit or Employment Support Allowance of the working age population.
6.20 There were 6,000 people currently claiming Incapacity Benefit who were about to be re-assessed and transferred to ‘active’ benefits including Employment Support Allowance and Jobseekers Allowance, over the next eighteen months.
6.21 Female employment rates had been at 61.0% with male employment rates at 72.9%. Female unemployment rates were at 10.5% and male unemployment rates at 13.1%. The rates for the economically inactive were: 32% for women and 18% for men.
6.22 There were 11,168 lone parent families in Southwark with 4,870 residents 2.3% of the working age population, claiming Lone Parent Income Support. In October 2011, the system of allowances changed so that lone parents were transferred from Income Support to Jobseekers Allowance once their youngest child reached the age 5, and they were expected to follow an active job-seeking pathway as a condition of receiving benefit. The 2001 Census recorded that 41% of children were living in one parent households and that 33 % of dependent children under 19 years were living in poverty. 19,610 children were living in families that were in receipt of out of work benefits and/or tax credits or that were living in households where the income was less than 60% of the median income.
6.23 Age cohorts and unemployment studies showed the comparative ages and the rate of claims for Jobseekers Allowance. The Jobseeker’s Allowance claim rates for the 18 – 24 age group had risen significantly from January 2008 to January 2012, with long term youth unemployment also significantly rising.
6.24 Southwark was found to have 45% of its residents qualified to degree level. The London average was at 39%. However, 13% of the population of Southwark had no qualifications at all. The London average was 12%. The proportion of residents with no qualifications were highest amongst those age 50 to retirement age (33.3%) and 18.8% aged 16 to 19 had no formal qualifications, which contributed to the London average which was at 18%.
6.25 One third of London’s jobs are in central London, with two thirds of employees making the commute from outside central London. Unemployment in London was around 9% overall. There was employment growth in construction, business, hospitality, education, professional services, health and education but there had been employment loss in public administration and defence, the manufacturing and financial services, transport and communications, wholesale and retail industries.
6.26 In Southwark, the current stock of VAT and/or PAYE registered businesses were at 11,745 with 10,250 micro businesses who had fewer than ten employees and 8,775 who had fewer than five. There were 1,420 small or medium sized enterprises with 10-249 employees and 75 large businesses with 250-plus employees. Southwark was the 20th largest local economy in the UK and the 6th largest local economy in London.
6.27 Members wanted more information about how many people were going through the college system and they wanted to know if there could be some work commissioned which focused on the numbers in training and education, with the possibility of a new strategy as an objective.