Welfare-to-work and the New Deal

Welfare-to-work is on trial in many countries. In Britain it has become the government’s most important policy for lowering unemployment and expanding labour supply. But can it work? And what lessons does Britain’s experience provide for other countries? This paper argues that whilst the Welfare-to-Work approach has the power to transform the lives of millions—by making them self-sustaining rather than dependent—it requires extreme sensitivity. The help must be of very high quality and the spirit of the policy must be visibly in the clients’ interest. The author concludes that the New Deal has been an extraordinary success from that angle, with very high levels of client satisfaction. It is a good example for other countries to follow. But each future step must be as sensitive as the last.