New Welfare Delivers More Jobs, But Are They Any Better?

Much discussion of welfare state policy for people of working age centres on what might broadly be termed work-centred welfare or ‘new welfare’ (activation, social investment, pre-distribution) as opposed to traditional tax-and-spend. This paper reviews the background to this approach, notes that in practice (at least in times of real growth) work-centred approaches seem more successful in mobilising people into work than in reversing disappointing poverty and inequality trends, draws attention to exogenous factors (more intense international competition, falling wage share, the rising return to skill) bearing on these outcomes and presents some recent analysis. This suggests that stronger contractual rights, which do not receive so much attention in much new welfare debate also have a role to play in ensuring that the proceeds of social investment are shared more equitably.