ERSA Presentation

1. ERSA
Presentation
By Safaraz Ali
03-Oct-2022

2. Civil Society
Civil society refers to “a wide
array of organizations:
community groups, non-
governmental organisations
[NGOs], labour unions,
indigenous groups, charitable
organizations, faith-based
organisations, professional
associations, and foundations.”
World Economic Forum Definition

3. Employment Support
Charities and
voluntary
organisations
Private
organisations such
as private training
providers
Public sector
organisations
Schools Colleges Universities
The employment support sector supports current and
future jobseekers to gain sustain and progress in work!
The sector comprises:

4. Inflation and the Cost of Living
Impacts the sector in all directions:
• Inflationary costs on the organisation
itself
• The cost of living on the organisation’s
staff
• The costs on the businesses that we
rely on to employ people and provide
good jobs
• The costs on the people we are trying
to help engage with employment or
progress in their careers
• Uncertainty of funding available for
government funded employment
support programmes

5. Impact on Employment Support Sector
Organisations
• Government formula funding is of a
fixed value governed by the
qualification funding rates over the
life of the contracts.
• Where more funding goes to
overheads and operating costs
such as mortgage or rent
payments, energy costs, increased
travel costs, increased staff
salaries, less goes to front line
delivery.
• Key programmes are not working
properly
• Apprenticeships no longer serve entry
to employment for young people as a
primary focus.
• An Apprentices National Minimum
Wage is not a realistic salary.
• 20% off the job learning is 20% salary
for nonproductive work
• Employer contribution is a luxury

6. Impact on Employment Support Sector Organisations…
• There is huge uncertainty over
future contracts
• European Social Funds and transition
to UK based funding alternatives are
transitioning
• The education system has huge
bureaucratic burden.
• Apprenticeships have stringent rules
that are not flexible enough to support
a modern workforce
• Adult Education Budget is devolving
to local government – instead of one
AEB contract we operate 10 contracts
and so have become 10x less
efficient.

7. Cost of Living on Staff
• Lower than inflation pay rises
for at least 2 years,
• Higher energy bills,
• Cost of food increases,
• Fuel increases
• Mortgage prices increase
driving up monthly
repayments and rent
increases.

8. Cost of Living on Beneficiaries
• Tightening jobs markets as employers
adapt to costs
• Reduction in career development
opportunities and in work learning as
employers need to sweat their assets and
priorities essential spending.
• Lower than inflation pay rises for at least 2
years,
• Higher energy bills,
• Cost of food increases,
• Fuel increases
• Mortgages prices increase driving up
monthly repayments and rent increases.

9. Inflationary Pressure on Businesses
• Higher energy bills
• Higher transport costs
• Increasing cost of borrowing
impacting loans, equipment rental
costs, mortgages
• Increasing staff payroll costs
• Less profitability
• Less working capital for
expenditure that is not essential.

10. Inflationary Pressure on Businesses…
• Impacts
• Lost talent as the most skilled staff
leave where personal pressure
becomes
• Increased recruitment costs
(recruitment, onboarding, training and
the running in period for a new start
even if qualified they have to learn the
company way of doing things)
• Unfulfilled jobs as skills shortages in
sector requiring qualified people,
leading to poorer outcomes.
• Less budget or time for staff
development training

11. Uncertainty of Future Contracting
• Providers cannot rely on
government funding certainty
• National Adult Education Budget
(AEB) is up for retender early
2023.
• Devolution of Adult Education
Budget continues to throw up
challenges e.g. shutting down local
offices, laying off local staff, time
spent managing multiple contracts,
operating small scale inefficient
contracts.
• Uncertainty over the transition of
European Social Fund
programmes to equivalent UK
based funding streams – What will
this look like?, What will it fund?,
Will it provide continuity?
• Changes to Advance Learning
Loans and restricted access to the
system for providers who have not
received a full Ofsted inspection.
• Learner and employer driven
reduction in demand for
Apprenticeship provisions

12. Employment Support
• Employment support is about providing a
service that is tailored to the needs of the
individual participant in a blend of
vocational training, employability skills,
personal development and overcoming
personal circumstances to unemployment
or career progression.
• A squeeze on the budget will have severe
consequences. To be viable a College
generally needed 8 students in a
classroom to be a minimum viable
programme. Providers will only be able to
survive and remain profitable by pursuing
economies of scale and eliminating choice
for participants.

13. Employment Support…
• For providers funding is
formula funded at a fixed rate
for the life of the contract.
• 1:1 job coaching time will be
reduced as the fees cover
less hours.
• A tightening jobs market will
see less opportunity for
unskilled, inexperienced,
people with barriers to
employment.

14. Apprenticeships, Traineeships and T-
Levels
• Apprenticeships no longer serve
entry to employment for young
people as a primary focus.
• An Apprentices National Minimum
Wage is not a realistic salary.
• 20% off the job learning is 20%
salary for nonproductive work
• Employer contribution to learning
costs is a luxury and not a priority
in the current climate.

15. Apprenticeships, Traineeships and T-Levels…
• For business an apprentice is a long-term
investment in the future. In a crisis
productivity and surviving until tomorrow
becomes the new priority.
• For learners less opportunity to pursue an
apprenticeship which adversely affects
those from lower socio-economic groups
that rely on apprenticeship pathways.
• For providers an increasing in
apprenticeship terminations, fewer new
apprenticeship opportunities and
subsequently a poor Ofsted grade based
on lower retention and completion rates
and less income to provide economies of
scale.

16. Adult Education Budget
• ‘Better off in work’ – has been the
historically mantra for employment
programmes to engage with hard to help
unemployed and stubborn worklessness.
The focus is work always provides a
better quality of life than welfare!
• ‘In-work benefits’ – In more recent years
in-work benefits has become a thing! In
order to promote the ‘better off in work’
mantra employability advisors have
increasingly had to sell ‘in work’ benefits
such as working tax credits as a
motivation for work to reach this better
quality of life.

17. Adult Education Budget…
• ‘Food Banks’ – Even before the
latest energy crisis and its
subsequent inflation and the cost
of living. People in professional
occupations receiving ‘in work’
benefits had started to use
foodbanks.

18. Final Thoughts and Thank you
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