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IER Newsletter - December 2020

IER Newsletter - December 2020
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End of year message from IER’s Director

Usually this message is a short one to thank our research partners and sponsors. Whilst we make those thanks, and sincerely, this year is also different. Let’s be honest, 2020 wasn’t a good year. As the Covid pandemic unfolded, jobs suffered and the labour market is now loosening. The pre-Covid rise in youth unemployment has become worse, a huge swathe of the self-employed have disappeared, and jobs that were furloughed in some industries are now disappearing as government support changes.
And as the pandemic hit, jobs became a public health issue. On the one hand, some workers, most obviously in health and social care, were directly exposed to the virus leading to infections and, tragically, deaths. Some workers, particularly from Black and Asian ethnic groups, were disproportionately affected. On the other hand, the importance of also protecting other workers in essential services in teaching, policing, food production, supermarkets and transportation for example became obvious.
IER was grateful during the lockdown to be able to support efforts to deal with the pandemic through new research: the pandemic’s impact on apprenticeships, the graduate labour market and working-class women, and within the UK and internationally, for example in Colombia and Australia. We even developed a method to identify occupations most at risk. Remote working in often challenging personal circumstances, IER’s researchers and support staff were a credit to the Institute and University. They underlined IER as a public service.
Now, as the Covid threat recedes hopefully, ideas developed by our researchers before and during the crisis will help the post-Covid recovery and growth. West Yorkshire Combined Authority has adopted the idea of piloting better use of skills in its businesses for example – an initiative developed by IER with the OECD. Similarly, IER’s project with Nottingham University that identifies the on-going challenges posed by Covid to working class women will, through the Women’s Budget Group, feed into national government policy.
Whilst a full return to the ‘old normal’ is unlikely, the ‘all change’ thesis mooted by many might be wishful thinking. It is more probable that the Covid pandemic will accelerate changes already mooted. Some of these trends are negative: rising precarious employment and constrained pay-packets for example. More positively, there is a good chance that more and better flexible (as distinct from remote) working might finally be achieved. Likewise longstanding calls for the creation of more climate-friendly jobs might also be realised. At the same time, we have to hope that those of us lucky enough to keep our jobs will emerge from the lockdowns cash rich and able to spend so that we stimulate consumer demand, thereby boosting labour markets in some industries and regions.
During the first lockdown we also called on the UK Government to revamp its Industrial Strategy. As the second wave of localised lockdowns eases, national and regional governments should set up taskforces to examine the future of work. The remit should be broader than the current debate focused on digitalisation and clever robots. Instead, the taskforce should have two linked remits. The first to boost employment and reboot self-employment. It should assess which jobs can be sustainably revived as well as created. The second to boost the quality of those jobs. It should ensure that all future jobs are healthy jobs and meet the material needs of all workers to have decent lives. If government really does start to build back better and these taskforces are set up, IER will be there to support their work through its research and evidence-based ideas.
Everyone in IER wishes you a hopeful 2021.

Future-proofing apprenticeships

IER has been working with the Co-op Group to evaluate its apprenticeship programmes. The initial study was halted due to lockdown restrictions and it was decided to change the focus of the study to see how apprenticeships could be developed to meet the changing job roles and skills needs , and help to build back better. The study focused on the two sectors where the Co-op delivers most apprenticeships: food retail and funeral care. The research involved the analysis of employment and apprenticeship data and interviews with the main employers, sector groups and providers across the two sectors. Despite distinct differences between the two sectors, there were a lot of common themes including a broadening of job roles, more flexible working and the need to develop digital skills. The report 'Future Proofing Apprenticeships' was launched at a virtual conference on Thursday 26th November. Attendees included sector stakeholders, apprenticeship organisations and Government Departments. The report is available on the Co-op website.

Discussion paper on Indian skills-training programme

This discussion paper analyses primary survey data from participants of a large-scale skill-training programme that targets rural poor youths in India. Focusing on two dimensions of individuals' identity, caste and gender, the empirical findings suggest that training participants from the most socially disadvantaged groups - Scheduled Tribe (ST) and Scheduled Caste (SC) - have significantly lower income aspiration when compared to Other Backward Class (OBC) and Other Caste (OC) participants. Female participants also have significantly lower aspiration than their male counterparts. The aspiration gaps exist even after controlling for various background characteristics, including participants' pre-training personality traits and soft skills. Individual-level and household-level factors mediate some of the aspiration gaps based on caste and gender. The paper finds evidence that for SC/ST female participants, the disadvantages on both caste and gender dimensions add up; this is reflected in their lower income aspiration levels, in comparison with all other groups. Thus, the results support the hypothesis of "double jeopardy" instead of "intersectionality" in this context.

IER research used to inform apprenticeship pay setting

The Low Pay Commission's Report 2020 was launched on 9th December 2020, and was used to set National Minimum Wage (NMW) rates for 2020/21, as announced by the Chancellor Rishi Sunak on 25th November 2020. IER's report 'How employers set pay for apprentices' involved a multivariate analysis of apprenticeship pay data, and 30 case study interviews with employers delivering apprenticeship frameworks where low pay was greatest. The study found that the minimum wage for apprentices applied almost exclusively to new recruits rather than existing employees (who were paid their existing rate for the job). For new recruits, few employers paid the apprentice minimum wage. Instead they added a bonus: as a recognition of the apprentices contribution to the business; out of 'fairness' as part of a Corporate Responsibility; and due to wider market rates either as a result of market forces or because of occupation or sector wide agreed pay rates. The NMW apprentice rate was most likely to be used in those sectors where fully qualified workers were paid the NMW age rate in order to maintain differentials.

Dickinson. P., Hogarth, T. and Cardenas Rubio, J. (2020). How Employers Set Pay For Apprentices. Low Pay Commission.

Other publications

Cárdenas (2020). A web-based approach to measure skill mismatches and skills profiles for a developing country: the case of Colombia. Colombia Científica. ISBN: 978-958-784-544-0.