In this guest blog, Dr Jonathan Arlow asks whether the current Work Placement Experience Programme represents a revamped Jobs Bridge scheme. Concerningly, Dr. Arlow argues that - despite some improvements - the new programme has repeated many of the former scheme's mistakes.
The JobBridge internship scheme was launched in July 2011, during a period of economic crisis in Ireland, and was marketed as a chance for young people to gain career experience in quality work placements, thus easing the transition from education to work. JobBridge originally consisted of 5,000 state-funded internships made available in the private, public or voluntary sectors. The internships lasted from six to nine months with an average working week of thirty-nine hours. On top of their welfare entitlements, interns received €50 a week from the Department of Social Protection (DSP). This was funded entirely by the state, and host organisations did not make any contribution to the cost of this labour.
Active Labour Market Policies (ALMPs) that involve the state intervening in the private-sector jobs market tend to be controversial; in fact, policy failure for ALMPs is incredibly commonplace. But right from its inception JobBridge attracted unusually fierce criticism, based on a widespread perception that the scheme was exploitative to the unemployed and that many of the internships were low-skilled jobs that did not require significant experience. Activists set up groups like ScamBridge and Work Must Pay to campaign against the policy, and it quickly became a toxic brand for the Government (especially the Labour Party) and an object of satire in the media. This public hostility contributed to the policy being unceremoniously dumped in May 2016 without any replacement scheme, by the then Minister of Social Protection, Leo Varadkar. However, the Covid crisis has led to a similar sharp spike in youth unemployment as was experienced during the Great Recession. As part of a series of policies to alleviate unemployment, the government launched the Work Placement Experience Programme in July 2021, and it quickly faced allegations that it was just a rehash of the JobBridge scheme. So, to what extent is this a credible allegation?
The following concepts are the three main criteria for judging the effectiveness of ALMPs and under all three criteria JobBridge can be viewed as having failed the needs of unemployed youth:
- Deadweight losses – this is the participation of young people in the scheme who would have found paid employment without it. The government sponsored evaluation report into JobBridge estimated deadweight losses of 75 per cent. This meant that three quarters of interns would have been as likely to find work if they had never entered the scheme.
- Substitution – this involves employers replacing paid staff positions with unpaid interns. This was estimated at about one in three internship places. Not huge numbers considering the scheme never involved more than 6,500 workers, but this still did significant damage to the entry level jobs market at a time of massive unemployment.
- Displacement – this this is the loss of jobs in other enterprises due to the competitive advantage given to organisations using the internship programme. There were no controls put in place to counteract this, and it was never even estimated as part of the reviews into JobBridge. This seems careless, as displacement can be quite a significant problem; for example, one Dublin based mechanics advertised for 28 internships during the lifetime of the scheme, which was the equivalent saving for that company of €273, 308 in labour costs at minimum wage pay rates (including employer’s PRSI). This obviously provided that company with a serious competitive advantage over other mechanics who did not use the scheme.
The biggest reason for JobBridge performing so poorly under the above criteria was that there was no regulation of host organisations, so employers were able to utilise the scheme in good faith and without any oversight, unless there were credible allegations of illegality. Effectively, any employer could post their JobBridge ad and commence interviews for state-funded internships that very same day, without any intervention by the state unless there were subsequent credible complaints of exploitation (and sometimes not even then). The evidence from FOI requests shows that making the scheme attractive to host organisations was an important consideration for policymakers, and civil servants who were urging for greater regulation of host organisations were being overruled by the Minister in charge of designing the policy, Joan Burton.
The Work Placement Experience Programme has yet to be formally assessed, but in terms of policy design it does seem reasonable to view it as a slightly re-jigged version of JobBridge. Like JobBridge it has an open-door policy for host organisations, has limited on-the-ground monitoring by case officers, no controls to counteract displacement, and it does not require host organisations to contribute to labour costs. Like JobBridge, a cursory glance at the job adverts for the scheme shows a worrying preponderance of low-skilled service sector jobs (such as retail and café work) that should not require a six-month training placement.
The new programme is officially marketed at unemployed youth, but it is actually open to all ages and all education levels. But effective ALMPs should be targeted at the employment needs of specific groups. For instance, it is just not possible to design a youth unemployment policy that works equally well for graduates and for early school leavers. Like JobBridge, the new scheme has not had trade union involvement during its design and implementation; even though the active participation of organised labour is something that has delivered successful ALMPs in other countries. So, many of the mistakes made in JobBridge have been repeated during another critical moment for unemployed youth.
However, under the new programme interns are only expected to work a maximum of 30 hours a week and they now receive minimum wage for their labour time (although the ‘wages’ are all still completely funded by the state). They are also entitled to paid annual leave during their internship and there is a training fund available to interns using the programme. These changes represent an improvement on the last scheme, but fundamentally there seems to be few lessons learnt from JobBridge. The open nature of the new scheme combined with the lack of host organisation regulation means that it is likely to deliver similarly high rates of substitution and deadweight losses as JobBridge.
Dr Jonathan Arlow is a Teaching Assistant in Dublin City University. The above blog post is based on his research into JobBridge (available here) and forthcoming research into the Work Placement Experience Programme.