Getting people work a priority

 

PLATFORM:Internships would allow the unemployed to use their talents and stimulate the economy, writes FEARGAL QUINN

NO ONE would ever argue that the terrible effects of this recession are all in our head. The business failures, unemployment, rising deficits and general misery of the recession are real and cannot be wished away. However, our response to these events – both as individuals and as businesses – can change our experience of them greatly.

This is a lesson that was brought home to me recently in two letters that show how people respond very differently to redundancy. It is a lesson that businesses must study and governments must understand if we are to prevent this recession from creating a lost generation of unemployed.

Some months ago, I received a letter from a recently qualified solicitor, who was in considerable distress.

Her training contract was due to come to an end but, because of the recession and the drop off in demand for legal services, her then employer was unable to continue her contract and had to let her go. Her inquiries to other solicitors turned up the same story: no one was hiring solicitors and many offices were laying off even their most experienced people.

Faced with the prospect of impending unemployment, she ended up taking a part-time job in her brother’s dairy business and also offered to work free of charge for two days a week at the office of a solicitor running a one-man practice in Limerick.

Two months into the job, the solicitor discovered he could accomplish far more with her on board. He was so pleased with her work that he offered to start paying her.

Furthermore, he asked her to come in to the office three days a week instead of two. She is now juggling two busy jobs, and combining legal expertise with invaluable experience at the coalface of business.

My resourceful and hard-working correspondent had discovered the old economic law that supply creates its own demand. As a retailer, I have often encountered this law. It usually reared its head when I had to take action based on a gut instinct about what would work in a grocery store – whether it was salad bars or in-store sausage making – even though market research at the time indicated there was no pre-existing “demand” for the service.

However, once you make a good product available, customers soon snap it up and demand that did not exist a year ago is now second nature. Whether the product is your own skills or a new idea for retailing does not much matter. Provided the product is good enough, you will create demand.

Compare this persistent approach from the young solicitor to that displayed in a recent letter to the Irish Independent, in which the letter writer spoke of a friend who had recently been made redundant.

Far from being spurred to seeking a new job, the friend said he was better off on the dole: by drawing on various welfare payments available to him as a father of four with a mortgage, he said he now received the equivalent of €39,000, a sum well in excess of the €35,000 he had been earning before losing his job. This allowed the newly unemployed man to spend most of his greatly expanded free time on the golf course, all at the expense of the taxpayer.

The welfare state that this golf lover is relying on has been one of the greatest achievements of developed countries in the 20th century. It has mitigated some of the worst side-effects of capitalism, by assisting the unemployed and ensuring that access to health and education are not based solely on inheritance or family income. However, there is something truly amiss when it encourages behaviour of this sort.

As our economy contracts, unemployment will continue to rise and it is quite right and proper that the State should seek to reduce the burden on the most weak and vulnerable. This will mean greater spending on unemployment benefit.

But it is also right and proper that the State makes it attractive and financially worthwhile for people to take a job rather than live off the State, whatever their personal situation. This means that the State must modify our benefits system to ensure that it is always more worthwhile to work than to stay inactive.

However, the problem goes beyond policy changes at the Department for Social and Family Affairs. Across Ireland, we need to assist people into work. One of the most effective ways is by means of internships, such as the one the resourceful solicitor found.

It is true that many of these are often unpaid or very poorly paid. At present, there is some resistance to the idea of unpaid internships in Ireland, particularly from trade unions which are rightly concerned about the possibility of employers exploiting free labour.

However, if the one-man solicitor had been obliged to pay my correspondent at the beginning, there is no chance he would have taken her on, and she would have struggled to prove her abilities. This is a particular dilemma for young people who do not yet have work experience.

The peril of exploitation is real, but the tragedy of wasted talent and energy is also real. Across Ireland, thousands of businesses are struggling for want of staff, while talented, unemployed people remain under-occupied. A massive expansion of internships could prevent the slow dissipation of energy and motivation that affects the long-term unemployed, while stimulating our economy and ultimately increasing full-time paid employment.

Of course an abundance of full-time paid work would be preferable, but that is not possible in our economy at present. This may not be an ideal solution, but these are not ideal times.

Feargal Quinn is an Independent member of Seanad Éireann and chairman of EuroCommerce