Working for Welfare? Modifying the Effects of Unemployment Through Active Labour Market Programmes

Abstract

In recent decades, research from across the social sciences has demonstrated a strong, consistent and causal link between unemployment and a wide range of negative outcomes. These outcomes go beyond economic problems, incorporating issues such as low well-being, poor health and weak social capital. During the same time, successive UK governments have expanded the use of active labour market programmes (ALMPs): a wide range of interventions that aim to move unemployed people closer to the labour market. ALMPs have been widely evaluated since becoming a central part of UK social policy, yet the majority of studies focus almost exclusively on economic outcomes, such as re-employment and wage levels. This is despite the weight of evidence suggesting unemployment is as much a social problem as an economic one. This discrepancy has led to a small but growing body of research suggesting that ALMPs might play a role in modifying some of the health and social costs of unemployment: beyond simply moving people closer to the labour market. Using a mixed methods research design, this study examines whether ALMPs achieve this by considering four key questions. First, are ALMPs associated with higher well-being, health and social capital compared to the alternative of 'open unemployment'? Second, if there is an association, how robust is this and is there any evidence of a causal function? Third, does the context of an ALMP - such as the specific type of scheme and the kind of participant - matter for understanding outcomes? And fourthly, how and why do people's experiences of unemployment and ALMPs shape their health and well-being?

The findings presented in this thesis offer five original contributions to the study of the health and social effects of ALMPs. First, there is a dichotomy in the effects of ALMPs: participants have higher well-being than the openly unemployed but similar health and social capital levels. Second, ALMPs are most effective in changing how participants feel about and evaluate their lives but are largely unsuccessful in mitigating negative emotions like anxiety. These two findings are evident in both cross-sectional and longitudinal data, suggesting the possibility of a causal function of ALMPs. Together, the findings suggest that the positive well-being effects of ALMPs are not necessarily linked to improved health or social capital but because participants begin to think about their lives in a different, more positive way. Third, well-being gains are experienced by both short-term and long-term unemployed people but disappear upon re-employment. This finding has an important implication for policy, with ALMPs seemingly effective as a short-term protective well-being measure. Fourth, this is the first UK study to explore whether ALMPs work more effectively for different types of unemployed people. The findings presented in Chapter Seven show that work-oriented ALMPs are more successful than employment-assistance programmes, whilst men, younger people, those with fewer qualifications, lower occupational status and lower pre-programme well-being experience the largest benefits of participation. Fifth, the qualitative analysis presented in Chapter Eight argues that ALMPs worked best when schemes reversed the perceived ‘losses’ associated with unemployment. Three processes of loss were identified - agency loss, functional loss and status loss – which, it is contended, help explain both the observed effects of ALMPs and the broader experience of unemployment. The thesis concludes with policy suggestions for improving the capacity of ALMPs to mediate the experience of unemployment.