Introduction:
Good morning, ladies and gentlemen.
I am pleased to join you here at the IBEC HR Leadership Conference. I would like to thank Danny McCoy, IBEC’s CEO and John Kennedy, the new President, for the kind invitation. I would also like to take this opportunity to congratulate Paul Rellis for all he achieved during his tenure as President of IBEC.
I am particularly pleased to address you this morning on the theme of a culture of innovation. I know there are a number of speakers at this conference, like Dr Rosabeth Moss Kanter, with a great deal of experience in this area. In one of her recent blogs for Harvard Business School, Dr Kanter outlined her nine rules for stifling innovation. Among those rules were being suspicious of new ideas, invoking precedent that didn’t work, and placing too much emphasis on predictability and procedure rather than innovation. I’m sure most of you here will have witnessed such failings in organisations at some stage in your career. Helpfully, Rosabeth also outlined actions leaders can take to allow innovation flourish. Encouraging new ideas, looking to the future rather than the past, leaving some slack for experimentation, being flexible, and so on.
I mention all this because sometimes people think innovation is solely a trait of the private sector, and entirely absent from the public sector. Today, I’d like to discuss the large-scale transformation I’ve overseen in the Department of Social Protection, the way we have teamed up with the private sector and employers to do this, and the future collaborations we envisage.
The Live Register context:
I’d like to start with some good news, and a word of thanks.
When we came to office, the economic outlook was so bad that the Live Register looked certain to break 500,000. Last week, the CSO confirmed that the Register had fallen to 408,670 – a drop of more than 20,000 year on year. I am now confident that in the next couple of weeks, we will see the Register fall below 400,000 for the first time since May 2009. That is still far too high, of course, but we are making firm and visible progress. And that progress feeds into the continuing improvement in the public finances.
As you know, the Government announced this week that the forthcoming Budget adjustment would be €2.5 billion rather than €3.1 billion. By making this lower adjustment, we will still comfortably exceed our deficit reduction targets while at the same time affording some more breathing room for the recovery. One of the reasons we were able to ease the size of the adjustment was because the Live Register reduction had produced €150 million in welfare savings. Getting people back to work is the most effective way of reducing welfare expenditure – and we are doing it.
There are two principal factors at play here. The first is that, since coming to office, I have focused on transforming the Department from the passive benefits provider of old to an active, engaged and focused employment service. So in addition to providing income support, we now help jobseekers find the work, training and education they need. We call our new one-stop shop service - where jobseekers can get their income and employment supports in the one place for the first time - Intreo. If there is an excellent example of large-scale public sector transformation – and one that has been undertaken at rapid pace by international standards - this is surely it. And I want to compliment the leadership provided by the Secretary General and senior management of the Department, and the willingness, cooperation and dedication of staff, which made this transformation a reality.
But the second factor is, of course, that we can only help people return to work if the jobs are there in the first place. And as you know, with the economy stabilising and business sentiment improving, the private sector is now creating 3,000 new jobs every month. Which is why I want to say thanks, because employers have endured the worst of the crisis, are now slowly but surely coming out the other side, and are creating the jobs in the process that will lead to a sustained economic recovery. That is not to understate in any way the challenges businesses continue to face in the current climate.
I’m sure many of you here today can attest to the difficulties of being tasked with finding yet another saving from the human resource budget. But the reality is that the recovery has taken hold, and the effects of it are now being seen. I was particularly heartened to see the very encouraging outlook from the Economic and Social Research Institute this week, which predicted GDP growth of 2.6% for next year. If realised, that would boost employment even further, and put the wind at our backs as we leave the bailout programme well behind us.
Employer engagement:
But it would be a mistake to think that, simply because we are now going in the right direction, we have done enough and no longer need to innovate. We did not stop at remodelling and transforming our welfare service to provide an engaged employment service too. We did not put in place dedicated supports just for jobseekers alone. We also put in place dedicated supports for employers. I’m conscious that not every organisation is familiar with those supports, so I’d like to say a few words about them.
We now have a dedicated Employer Relations Division within the Department. Put simply, its task is to liaise with employers and help them – help you – with your recruitment needs. As employers, you can pop into local Intreo offices to avail of these supports, or you can contact the Department centrally.
Let me give you some practical examples.
An increasing part of our work is “job-matching” – that is, “gathering up” vacancies and matching jobseekers with them. We have developed bespoke recruitment and training programmes for organisations such as Tesco and the FAI.
We organise jobs fairs around the country, and arrange for on-the-spot interviewing. For instance, at one of those jobs fairs in Dublin recently, one of the employers present was a home-care provider with 30 vacancies. Any jobseeker who expressed an interest in one of those positions was given an immediate interview.
We have also put in place dedicated schemes to help employers with recruitment. JobBridge, the national internship scheme, is one example. Earlier this year, the number of internships taken up under JobBridge passed 20,000. And the independent evaluation of the scheme by Indecon Economic Consultants demonstrates that JobBridge is working for jobseekers and employers alike.
More recently, together with my Cabinet colleague Richard Bruton, I introduced JobsPlus, which assists employers directly with the cost of recruitment. The scheme offers a grant of €7,500 paid over two years if an employer hires a jobseeker who has been more than a year unemployed. That grant rises to €10,000 if the jobseeker has been more than two years unemployed.
The true value of JobBridge is its simplicity - cash grants paid monthly in arrears. JobsPlus replaced the more complicated PRSI exemption scheme. And despite only launching JobsPlus in July, the benefits of replacing a cumbersome scheme with a much simpler one are already clear. To date, over 1,200 employers and 2,400 jobseekers have registered for JobsPlus. This application rate is more than three times higher than for the PRSI exemption scheme, which is very encouraging – and shows the benefits of innovative thinking.
The expertise of the private sector helped hugely in developing both JobsPlus and JobBridge.
I was very conscious from the moment I took office that we needed to involve employers in the process of transforming our organisation and developing new services that would work for employers to the benefit of jobseekers. I am gratified at the response I have received.
For example, Martin Murphy, MD of Hewlett Packard, and Sean O’Driscoll, CEO of Glen Dimplex, were very involved in the design and implementation of JobBridge. Employers like Heather Reynolds of Eishtec gave of their time to advise us on the design and implementation of JobsPlus. And organisations like the CIPD, IBEC and Chambers Ireland work closely with us in organising employer briefings and events around the country.
HR specialists also support the Department by giving their time and expertise on a voluntary basis to help SMES and jobseekers access and use our services. In this regard, special mention is due to WorkLink established by Kevin Empey.
So none of this could have been done without the public and private sector working in concert.
Before leaving the topics of JobBridge and JobsPlus, I would ask all of you who have not yet done so to examine how these schemes can help your business grow and help get jobseekers back into work. I would also like to remind you that a JobBridge intern who has demonstrated the capacity to join your organisation as a full-time employee will in most cases also be eligible for the JobsPlus initiative.
Future developments:
But if those schemes are the epitome of flexible thinking, we can’t stop there and say we’ve done enough.
So let me talk about some of the measures my Department is currently considering, both to further reduce the Live Register
and strengthen our employer engagement programme.
And of course, I would welcome your feedback on any or all of this, as well as any additional ideas you may have.
On the Live Register side, the Government intends to build a new partnership with the private sector to assist the long-term unemployed. We have agreed to contract third parties to provide activation services to jobseekers out of work for more than a year. This will supplement the services my Department provides through Intreo. The new scheme will be called JobPath, and will work on a payments-by-results basis, meaning the companies will get paid only if they find sustainable employment for clients. Our focus is on ensuring an innovatively designed, well-managed scheme that will also include the community and voluntary sectors and avoid some of the pitfalls experienced by other countries in the past. The procurement process is now under way, and we would hope to have JobPath up and running in late 2014.
On the employer engagement side, our consultations to date – with business, with other public employment services, and with independent experts in this area – have seen a number of common threads emerge. For example, it has been suggested to us that more effective engagement with employers will require the development of a formal account management structure within the Department. In other organisations, as you are aware, this involves segmenting the employer market into categories based on scale of employment. Account managers and account teams would then be allocated on a national, regional and local level to deal directly with these various segments. That would be a fundamental change, and one which is under consideration, although resources would pose a significant problem of course.
More immediately, we intend to redevelop and upgrade our jobsireland.ie vacancy matching website to improve the service for employers. It has been suggested to us that one way of improving this service is to ensure that jobseekers registering with the site upload their CVs – and I view that as a very practical recommendation.
All of these and other suggestions for change will be fed into the Labour Market Council. This is the new jobs council of leading industry and policy experts which I’ve appointed to drive the implementation of the Pathways to Work 2013 strategy to tackle long-term unemployment. Among other members, it includes the aforementioned Martin Murphy and Heather Reynolds, as well as Tony Keohane of Tesco, Siobhan Talbot of Glanbia and IBEC’s head of education, social and innovation policy, Tony O’Donohoe. The skills of the Council members range from building businesses and creating thousands of jobs to developing innovative labour market policies and fighting for the best interests of jobseekers. Between them, the members have the perfect blend of skills to help drive implementation of the Pathways strategy and advise on what further innovative actions can be taken across Government to increase employment.
Again, like I said, I would very much like to hear your own views on these and related subjects.
One of Rosabeth Moss Kanter’s other rules for stifling innovation is to fail to consult widely. I’m determined not to make that mistake – because the scale of the unemployment challenge demands a similar scale of innovative approaches to solve it.
Conclusion:
This Government inherited an economy on the brink of collapse, and two and a half years later, the economy is firmly in recovery mode. But we won’t truly be able to say the country has recovered until we’ve successfully reduced long-term unemployment. We can’t afford the recovery to be a jobless one.
That is the reason behind the changes I’m making to how our welfare and employment services operate. And it is why the Department has recalibrated to ensure that engagement with employers is now a core function.
Getting people back to work is not simply about reducing welfare expenditure or boosting tax revenues, important as both those issues are. The Government is committed to getting people back to work because of the huge benefit that work has on a person’s self-esteem, financial independence and future life.
As HR managers, you will be aware of the transformative effect that employment can have. What you may not be as aware of is the skills mix of people on the Live Register. From managers to craftsmen – and women – the depth and breadth of talent and experience of jobseekers on the Register will surprise you if you haven’t previously looked at it. Job vacancies are frequently filled by persons who are already in employment but wish to move. People who are out of work can find it very difficult to compete, particularly if they are long-term unemployed, as research shows employers are often reluctant to hire from the Live Register. I want to change that, but I need your help in doing it. So I would encourage you to look at the skills of those on the Register, look at the employer supports offered by my Department, and take advantage of both.
The public and private sectors working in concert - the very model of the kind of innovation that will foster a flourishing, and sustainable, economy.
Thank you.