Extending employability or solving employers' recruitment problems? Demand-led approaches as an instrument of labour market policy

For years, labour market policy in the UK has been dominated by activation measures that seek to increase employment levels among the unemployed. This supply-side focus emphasises individual characteristics and responsibilities in isolation from wider labour market factors. However, there is widening acceptance that policies for employability can provide a link between the supply and demand sides of the labour market. This implies the involvement of employers in the design of skills training and work experience programmes, and for these to be related to employment sustainability and career progression. Several projects in the UK under the New Deal Innovation Fund are currently testing the merits of what is termed a 'demand-led approach'. This paper examines this in terms of increasing job procurement and retention, and critically assesses the way in which it has been applied in the UK to date. It investigates the role played by labour market intermediaries in engaging both job seekers and employers, and considers the difficulties of successfully implementing the approach in different circumstances. It concludes that in most cases demand-led schemes in the UK have been less about improving employability than meeting employers' short-term labour needs.