Evaluating Jobseeker's Allowance: a summary of the research findings
A hard copy of this report summary can be obtained by contacting Paul Noakes [E-Mail: Paul.Noakes@dwp.gsi.gov.uk] or by writing to him at the 'Social Research Division, Department for Work and Pensions, 4th Floor, Adelphi, 1-11 John Adam Street, London WC2N 6HT'.
Research Report No. 116
By Elizabeth Rayner, Sohagini Shah, Richard White, Len Dawes, and Kevin Tinsley.
Jobseeker's Allowance (JSA) was introduced in October 1996 and replaced Unemployment Benefit (UB) and Income Support (IS) as the benefit for unemployed people seeking work. In order to assess whether the new benefit had met its objectives, a large-scale programme of research was undertaken, based on a series of 'before' and 'after' studies designed to compare the knowledge, attitudes and behaviour of clients under the UB/IS and JSA regimes. It was sponsored, and managed jointly, by researchers from the Department of Social Security (DSS), the Department for Education and Employment (DfEE), the Employment Service (ES) and the Benefits Agency (BA). The centrepiece of the evaluation was a series of client surveys, in which the experience of two separate samples, some 10,000 unemployed people in total, were compared under the old and new benefit regimes. Respondents in each sample were interviewed twice, approximately six months apart. A macro-economic evaluation and a number of smaller qualitative studies complemented the client surveys. This report draws together the key findings of the evaluation as a whole.
The main findings are that:
- JSA led to a large increase in movements off the claimant count in the first year of operation. Thereafter, it has resulted in smaller but significant increases in movements off the claimant count, which are accounted for by increased movement off the count in areas of low unemployment and amongst longer-term clients.
- Both before and after JSA, two-thirds of people who left benefit moved into work. The majority of return-to-work jobs were stable, especially for those who had experienced only a short spell of unemployment. Former jobseekers were less likely to return to benefit after the introduction of JSA; and those who had left benefit for work were less likely to return to unemployment-related benefit when they lost their jobs.
- Since the introduction of JSA, there have been fewer inactive clients. In general, the jobsearch strategies of unemployed people changed little with the introduction of JSA. However, there was a significant increase in the numbers of jobseekers contacting employers directly, suggesting that jobsearch behaviour has become more active since the introduction of JSA.
- Clients are more likely to be given advice and told of job vacancies under JSA. Jobcentre staff were more likely to directly contact employers on a client's behalf after the introduction of JSA.
- Jobseekers claim to understand the rules better under JSA, and awareness of benefit sanction as a consequence of failing to actively seek work increased significantly after the introduction of JSA. Many jobseekers experiencing disallowance or sanction increased their jobsearch as a result of the penalty. However, others considered that their personal circumstances had made the penalty unavoidable, suggesting that the deterrent effect is limited.
- Around one in ten jobseekers were participating in part-time work, voluntary work, and/or a course of study whilst claiming JSA. The impact of participation in activities whilst claiming upon individuals' chances of moving off benefit varied.
- The economic activity of individuals continued to influence that of their partners after the introduction of JSA. Other factors that influence partners' economic activity include household type, and the level of local unemployment.
Introduction
Jobseeker's Allowance was introduced in 1996 and replaced Unemployment Benefit (UB) and Income Support (IS) as the benefit for unemployed people seeking work.
In order to evaluate the impact of JSA against its objectives, a large-scale programme of research was conducted. This paper draws together the key findings of the evaluation as a whole.
Speed of leaving unemployment
JSA led to a large increase in movements off benefit in the first year of operation. Thereafter, it has resulted in small but significant increases in movements off benefit, which are accounted for by increased movement off benefit in areas of low unemployment and amongst longer-term clients.
The likelihood of leaving benefit remained highest during the first eight weeks of unemployment, with the 'average' spell of unemployment being approximately three months. Otherwise, the relationship between social and demographic characteristics, and duration of unemployment, remained the same. A balance between flexibility regarding working conditions and focussed jobsearch continued to be important in securing work.
Destinations and experiences of those leaving unemployment
After JSA, just over two-thirds of people who left benefit moved into work, compared with just under two-thirds before the introduction of JSA. The duration of a client's unemployment and the level of local unemployment both influence the destinations of those who cease claiming JSA. The majority of return-to-work jobs remained stable both before and after JSA, especially for those who had experienced only a short spell of unemployment.
Former jobseekers were less likely to return to benefit after the introduction of JSA; and those who had left benefit for work were less likely to return to unemployment-related benefit when they lost their jobs. This is accounted for by the increase in the proportion of people who took up part-time work or who experienced health problems.
In general, JSA has had little impact upon the job satisfaction levels of those leaving unemployment, despite the fact that return-to-work earnings have fallen.
Jobsearch behaviour
Since the introduction of JSA, there have been fewer inactive clients. More jobseekers are making regular job applications under JSA; and clients in high unemployment areas are now making as many job applications as those in low unemployment areas. However, the increase in job applications made by those in high unemployment areas has not led to a corresponding increase in movements into work for this group.
In general, the jobsearch strategies of unemployed people changed little with the introduction of JSA. However, there was a significant increase in the numbers of jobseekers contacting employers directly, suggesting that jobsearch behaviour has become more active since the introduction of JSA.
JSA interventions
The content of the New Jobseeker Interview had improved under JSA, with a greater number of jobseekers being informed of the rules, alerted to job vacancies, and taking action as a result of the interview than was the case under UB/IS. Most jobseekers reported following the Jobseeker's Agreement to some extent, but less than half of these found it useful.
JSA has succeeded in changing jobseekers' perceptions of the purpose of the Fortnightly Jobsearch Review, and the interventions themselves are now more focused on jobsearch. 'Active signing' was found to have a significant impact on movements off the claimant count.
Jobseekers' attitudes towards greater ES intervention were mixed, and 'jobfinders' tended to underestimate the role ES played in helping them find work. The transition to delivery of JSA from a single office appears to have been seamless. The quality and consistency of JSA delivery has improved even since the introduction of JSA.
Understanding of rules and obligations amongst jobseekers
JSA has succeeded in reinforcing the idea of a 'contract' between client and state. Awareness of the existence of disallowance and sanction was very high both before and after JSA, and jobseekers generally agreed with the principle of sanctions. However, the proportion of jobseekers who believed that sanctions would be applied has increased since the introduction of JSA, and over the post-JSA period.
Many jobseekers who had been disallowed or sanctioned expressed surprise at their penalty and expressed a need for more face-to-face contact with ES. Appeals against disallowance or sanction have increased under JSA. Disallowance and sanction had a significant impact upon jobseekers, exacerbated by their uncertainty of entitlement to hardship payments. Many jobseekers experiencing disallowance or sanction increased their jobsearch as a result of the penalty. However, others considered that their personal circumstances had made the penalty unavoidable, suggesting that the deterrent effect is limited. Only a third of ES advisors believe penalties are effective in enforcing compliance with benefit rules, although their attitudes towards disallowance and sanction are much more positive than before the introduction of JSA.
Activities whilst claiming
JSA had little impact upon levels of jobseekers' participation in part-time work whilst claiming, with around one in ten participating. Income disregard levels continued to act as a major disincentive, and the introduction of the Back to Work Bonus has failed to strengthen the appeal of part-time work.
Evidence regarding the 'stepping stone' effect of part-time work whilst claiming is inconclusive, and suggests that part-time work whilst claiming has no great effect upon movements off benefit for JSA claimants.
Around one in ten jobseekers participate in voluntary work whilst claiming, as was the case prior to JSA. There is some small evidence that voluntary work had assisted in the pursuit of full-time work for some groups of JSA claimants.
Around one in ten jobseekers had experience of studying whilst claiming JSA. Those who do study tend to be already relatively well-qualified. Possessing educational qualifications was associated with an increase in the speed of leaving benefit; but studying whilst claiming significantly reduced the speed of return to work. Such clients were often determined to finish their courses before moving into work.
Partners and unemployment
The characteristics and economic activity of jobseekers' partners changed little after the introduction of JSA. The economic activity of individuals continued to influence that of their partners, although the impact upon partners' behaviour is not immediate.
One of the most significant changes since the introduction of JSA has been in the timing of partners' withdrawal from the labour market. This may be due to the reduction, to six months, in the period of entitlement to contributory benefit. Benefit disincentives continue to influence partners' economic activity, but play a lesser role than domestic commitments.
Conclusion
Research examining the effect of JSA found that the new benefit has had a significant impact upon unemployed people. Unemployed people are now looking for, and finding, work much more than they were before the introduction of JSA, and are now much clearer about the rules and their responsibilities - probably as a result of the extra advice and assistance they receive from jobcentre staff.
Relevant publications
Cragg, Ross and Dawson (1998) “Employment Service clients and the benefit system. ”London:Cragg Ross and Dawson.
Jackson, A. (1999). “ES and BA Staff Opinion Survey. ”ES Research and Development Report No. 27, Employment Service.
McKay, S; Smith, A; Youngs, R; and Walker R. (1999) “Unemployment and jobseeking after the introduction of Jobseeker's Allowance. ”DSS Research Report No. 99, Leeds: Corporate Document Services
Shropshire, J; Warton, R; and Walker, R (1999) “Unemployment and jobseeking: the experience of people with disabilities. ”DfEE Research Report No. 103, London: DfEE.
Shropshire, J; Warton, R; and Walker, R (1999) “Unemployment and jobseeking: the experience of ethnic minorities.. ”DfEE Research Report No. 106, London: DfEE.
Smith, A; Youngs, R; McKay, S; and Walker, R. (2000) “Understanding the impact of Jobseeker's Allowance. ”DSS Research Report No. 111, Leeds: Corporate Document Services
Thomas, A; Griffith, S; and Pettigrew, N (1998) “Education and training whilst claiming Jobseeker's Allowance: Workskill pilots. ”DfEE Research Report No. 61, London: DfEE.
Thomas, A; Pettigrew, N; Cotton, D; and Tovey, P (1999) “Keeping in touch with the labour market: a qualitative evaluation of the Back to Work Bonus. ”DSS Research Report No. 96, Leeds: Corporate Document Services
Vincent, J (1998) “Qualitative research on disallowed and sanctioned claimants. ”DfEE Research Report No. 86, London: DfEE