The impact of financial problems on jobseeking

The Centre was commissioned by Manchester City Council to research the impact of money and debt problems on jobseeking behaviour and to make recommendations to improve the integration of welfare to work and financial inclusion activity.

We conducted a review of existing literature and undertook focus groups with unemployed people in the Greater Manchester area in February 2010. The final report 'Out of work and out of money' is now available for download below.

We found that money and debt problems:

Distract people from jobseeking
Constrain jobsearch activity
Create disincentives to work
Affect the chances of employment being sustained

The report sets out twelve recommendations for national and local government, its agencies, lenders, and providers of employment services to improve provision. In particular, the report calls for proactive efforts to identify people with debt problems and for more to be done to reduce the financial burdens on the unemployed, including by:

Introducing a screening process for debt problems within Jobcentre Plus and ensuring rapid referrals take place to debt advice agencies
Creating new partnerships between lenders, including credit unions, and welfare to work providers to ensure that unemployed people have access to affordable credit and appropriate basic banking services and to put in place tailored financial education programmes
Improving the enforcement of rules designed to prevent the harassment of unemployed debtors; ensuring people have at least a month before having to restart payments to creditors once they obtain a new job; and reviewing insolvency rules to ensure that these do not create disincentives for people to work.

As part of the project we also developed a Debt and Financial Resource Guide for welfare to work providers to assist them in making effective links with services in this area, and have provided a brief checklist for welfare to work advisers to use with their customers.

Download Out of Work and out of money here

Download the Resource Guide for Welfare to Work Providers here

Download the Checklist for Welfare to Work Advisers here