Rishi Sunak’s Plan for Jobs has underlined once again that the chancellor is not afraid of pumping money into the economy to support businesses and maintain employment. The centrepiece of his plan – the Job Retention Bonus – could cost up to £9bn.
This initiative is the least certain of success among the many measures the chancellor has announced. It may simply not be economic for a company to retain staff until the end of January 2021 just for the sake of a £1,000 bonus if the business is not there to justify their wages. It feels to me that the scheme may be most effective in small and micro-businesses, rather than large-scale employers.
The chancellor’s emphasis on supporting employment for 16 to 24-year-olds – through a “kick-start” jobs scheme that will see the government cover a National Minimum Wage salary for 25 hours a week for six months, and through a £1,000 incentive to take on trainees aged 16-24 – is undoubtedly right and necessary to prevent long-term unemployment in the younger generation. The chancellor also announced a £17m investment to triple the number of available places in sector-based work academies, such as digital academies.
From a tech perspective, an influx of new, young talent with the right mindset and willingness to learn is absolutely what the sector needs. Skills shortages in tech are well documented – not least by our own long-running CIO survey that we produce in conjunction with KPMG – and the last thing the UK tech industry can afford at such a critical juncture is to be held back by a scarcity of talent.
Our Belgian business has been running a successful initiative for the past 10 years called Junior Classes, in which they take on young people and train them up in skills such as coding or IT support. Once they have reached a certain level, the individuals then go on-site at clients as contractors, before – all being well – the client offers them a permanent position. It’s a model we are now looking at introducing in the UK, encouraged by the chancellor’s announcement.
Other measures announced included an injection of government money into a job-finding support service in partnership with recruitment agencies for those who find themselves unemployed as a result of Covid-19.
There are positives for the tech sector to build on. Consumer preferences for digital channels have been accentuated through Covid-19, while tech solutions including cloud, robotics and artificial intelligence to enable businesses to run leaner, more efficient operations have become more important than ever. As long as the return on investment is there, the willingness to invest should be there, too.
I am cautiously optimistic that we will come through the tests in front of us and find our equilibrium in a new economy. After all, if nothing else, the coronavirus experience has shown that we are all more resilient and adaptable than we ever thought. Tech has already been instrumental to this and has a key role to play in the recovery.