Political change, People and Prospects: what the new UK Government means for local authority talent

The relationship between political and economic settings directly influences the confidence levels in business and hiring. It's not that surprising then, that the political unpredictability seen in the UK during the earlier part of the year negatively affected the short-term economic outlook prior to the election result.

Nevertheless, a surge in stability can often act as a trigger for economic renewal and in turn a boost to the job market. Manifestos from all parties shared a unanimous goal to enhance the pool of skills within the UK workforce, pointing to an anticipated shift in the employment and talent sphere.

Recent years have witnessed significant developments and transformations in the employment sector – accompanied by trials and obstacles, therefore there is a general sentiment of receptiveness towards renewed endeavors in this space.

What are the core plans in progress and what do they mean for the UK’s talent economy?

The next 100 days

The newly elected Prime Minister and his team quickly made their first policy announcements following the Labour Party's rise to power.

In the King’s Speech, a roadmap for the initial 100 days was set out, focusing on enhancing skills and promoting equitable employment to improve the UK's workforce pay structure. Significant investments are planned for key sectors that will likely increase the demand for specialist skills nationwide.

With existing skill shortages in various domains such as health, care, hospitality, logistics, facilities management, and engineering, local governments must strategise on how to attract new talent to the public sector or keep the talent they currently risk losing.

Here are the core topics that HR, talent and procurement leaders in local authorities need to stay on top of:

Making work pay

Perhaps the most prolific part of Labour’s initial campaign and manifesto was the new Employment Rights Bill. As stated in the King’s Speech new protections will be given to workers in accordance with the Labour party’s “Plan to make work pay” report.

The key regulatory changes set to make the greatest impact on HR, talent and procurement include:

Prohibiting zero-hour contracts to ensure fundamental stability and foreseeability for workers. Employers would be mandated to offer compensation to employees if work shifts or hours are revoked or amended without adequate notice.

Prohibiting fire and rehire tactics to enhance job stability for employees and eliminate bad practices or misuse of authority.

Reforms to the minimum wage that would include the current cost of living in the decision-making process for setting rates.

Businesses are now obligated to notify all employees, irrespective of their employment model, about their entitlement to join a union.

A written contract entitlement for self-employed individuals.

Transition from the existing individual employment classifications (employee, worker, and self-employed) to just two categories: worker and self-employed.

Navigating changes in employment laws can be complex and challenging. The broad range of working styles means a singular approach is not feasible. However, it's evident that both employees and employers will soon face notable shifts in employment law.

Local authorities can take comfort in knowing that our specialist teams are experienced in assisting clients through major regulatory and economic shifts. We offer workforce and talent solutions that comply with the latest regulations, featuring diverse skill sets and experiences designed to help you anticipate and adapt to changing regulatory environments and acquire essential skills required for your operations.

The Back to Work Plan

Economic inactivity has frequently made headlines this year. Statistics from the Office for National Statistics reveal consistently high rates of inactivity during the first half of 2024, particularly among younger demographics.

Responding to the situation, the recently appointed Work and Pensions Secretary, Liz Kendall, has disclosed additional information about the Government's Back to Work Plan. Similar to numerous present political events, the scenario is ever evolving, yet the fundamental elements of this plan at the time of writing consist of:

Establishing a combined national jobs and careers service by integrating Job Centre Plus with the National Careers Service.

Introducing additional decentralised powers for mayors and local councils to customise regional skills training programs, which will encompass health assistance primarily directed at facilitating employment for individuals with disabilities when possible.

Creating a Youth Guarantee that offers increased training, more apprenticeship options, and improved employment assistance for individuals aged 18 to 21.

Specifics of the Back to Work Plan are in the process of being finalised, with organisations like the British Disability Forum urging a consultative process with employers and stakeholders to ensure its effectiveness. The eventual framework that emerges should see UK local authorities participate in restructuring skills training for upcoming generations to benefit everyone.

Skills England: generating workforce transformation

In light of the revised Employment Bill and fresh initiatives to increase employment, it is essential to establish a definitive reporting mechanism to guarantee the effective execution of positive reforms. Spearheading these efforts will be the newly established public entity, Skills England.

The composition of the newly proposed entity remains to be finalised, yet there is an expectation that it will feature stakeholders from business, academia, and labour sectors to match its initiatives with today's workforce requirements. Presently, there are intentions to provide Skills England with capabilities to tackle training and development issues for individuals starting their careers, which involves substituting the Apprenticeship Levy with a more expansive growth and skills levy.

Expanding the Levy's scope would provide employers, such as local authorities with diverse needs, with increased options for investing their funds into workforce development, including temporary staff.

Institutions like the Institute of Fiscal Studies (IFS) caution that employers must embrace these changes to benefit fully, whereas entities like the Association of Professional Staffing Companies (APSCo) emphasise the advantages this will contribute to the adaptability of contemporary workforces.

As Tania Bowers, Global Public Policy Director at APSCo, commented: “The commitment to reform the Apprenticeship Levy to deliver a Growth and Skills Levy is more akin to the modern world of work where rigid training routes simply don’t work. Skills, migration, and industrial strategy must be in alignment and employers need genuine flexibility around using their Levy funds to fulfil their potential and help solve the skills crisis. We continue to call for the funding of upskilling and reskilling of all workers, including agency workers and the self-employed, and will work closely with the new government on the detailed implementation of this policy.”

New councils, roles, and responsibilities

As the UK's economy rapidly evolves, new initiatives have been presented to establish fresh organisations and councils, along with a restructuring of duties to optimally support the nation's prosperity.

Key changes that will have an impact on workforces and recruitment include:

The formation of a fresh Industrial Strategy Council is set to direct the expansion of 'clean power' and establish a more robust United Kingdom. The council will operate through what the new administration has termed an 'authentic' collaboration among enterprises, employees, labor unions, and academic institutions, with the aim of generating 'quality' employment opportunities and enhancing fundamental skill sets.

Creating a unified enforcement agency with enhanced authority to inspect workplaces and ensure compliance with statutory employment laws for laborers.

The growth of the Department for Science, Innovation and Technology (DSIT) into a digital hub to propel the UK's digital overhaul, including within the NHS.

Modifying the existing points-based immigration system to create a stronger connection with skills and the requirements of UK enterprises.

A more prominent function for the Office for Budget Responsibility, which might not directly connect to skills development, but will offer clear, structured fiscal regulations that ensure stability in the UK's economic environment.

Creating more diverse employment practices

While the King’s Speech outlined plans to improve equal pay and other elements to improve diversity in the workforce, one point that was missing that we certainly want to draw attention to is the plan to engage with prisons to help prison leavers into employment.

At Comensura , we know all too well that this is a notably untapped talent pool, and we are supporting many clients on campaigns to address this. Comensura’s Managing Director, Hoa Ngo, is a member of the Employment Advisory Board at Drake Hall Prison and we have run prison collaboration days to share insights with employers on how to better engage with this demographic and help more people into work.

The appointment of James Timpson as Prisons Minister is a move that we fully support in driving change and we’re hopeful that we will see positive changes in rehabilitation very quickly.

Building a resilient skills landscape

It is clear the UK is in real need of a strong skills market. Talent pools are limited in core remits while demand is accelerating at a pace previously unseen leaving local authorities concerned about being able to provide essential services for their constituents.

Our upcoming Local Authority Foresight Summit in Manchester on the 24th September will explore insights, predictions, and priorities through panel debates and practical peer-to-peer roundtable discussions, which will help local authority leaders in HR, procurement and talent gain valuable insights and leading thinking, enabling smarter workforce decisions.

You can sign up to attend here.

"UK local authorities need a strong, adaptable, and flexible skills landscape to meet the challenges and opportunities of the future. The new Government has outlined some promising plans to support this, but we also need to tap into the hidden talent pools that can make a difference to our economy and society," states Hoa Ngo, Managing Director of Comensura.

“We look forward to hosting an event that will identify and promote innovative new approaches that ensure the future of local authority service provision.”