Who Do You Hire: Graduates Or Apprentices?

I heard once that 89.2% of statistics are made up on the spot - but regardless of how trustworthy they are I wanted to begin today's post on apprenticeships with a look at some rather startling statistics. It gives you an indication of the sort of labour market that school and college leavers, who receive their results next month, will graduate into. Sadly, it's a bleak outlook.

• Graduates could be looking at £53,000 of debt for a three year degree course. 
• Graduate unemployment for 21-year-olds currently sits at 25% 
• 264,000 young people have been unemployed for more than 12 months
• There are 23 applications per job across all sectors in the UK

I've mentioned before that one of my main roles in my position as CEO is to attract talent to the organisation. Sometimes this is mistakenly viewed as shorthand for finding the best graduates, but it's certainly not the case that universities are the only pools of talent that we look in. This is in part due to the quality of graduates, but also because other pools can be just as rich. These are record times for apprenticeships and our own apprenticeship recruitment scheme has so far been an unqualified success.

We're not the only ones looking at the vocational sector either - last year there were 457,200 apprenticeship starts, 63% more than in 2010. Interestingly, the majority of apprenticeships were started by women. What's most remarkable is that this boom in apprenticeships is happening despite schools' efforts to direct pupils elsewhere. Blair's 1999 incantation that 50% of 18-30-year-olds should experience higher education still looms over secondary education and there's a terrible bias pushing young people towards university. A recent report by City & Guilds showed that 75% of school leavers had been informed about university but only 46% had been told about apprenticeships, you would imagine that fewer still had been told about gap years, distance learning or how to get a job. It seems especially unfair to railroad young people into an option that could leave one in four of them in debt and without a job, especially when alternatives exist.

Our own apprenticeship recruitment has involved 10 young people (you can meet them all and find out about them here) undertaking a series of tasks which have been monitored and reviewed. They've been doing everything from completing a day with one of our trainers, developing a work experience programme for Year 10 boys and selling tickets to a local rugby match for Salford Reds. Their reaction has been very positive and the trainer in particular was impressed by how eager to learn they were. In the boardroom, where I deputise for Alan Sugar, it's apparent that these are a set of able and likeable people and it's going to be very hard to see which five get the positions on offer.

I don't think I'm alone in being shocked at the state of some of the graduates we sometimes see. Not everyone who comes through the door with a 2:1 is any good at anything. I’m incredulous at how poor you can be and end up with a good honours degree, from a reasonable course and a reasonable university. Clearly, this is generalising - good graduates should (and do) demonstrate a depth of thinking and autonomy that you wouldn't expect from an apprentice, there will always be a premium to pay for a good graduate's skills, so I'm certainly not saying it's no longer a worthwhile investment. That said, there will come a point where the search for quality candidates leads organisations elsewhere. For THT we'll continue to examine every source and do what we need to in order to bring the talent into the organisation.

The very best of luck to anyone who has recently finished school or college for the last time, despite the current labour market if you can remain positive and examine all opportunities equally there will be exciting times ahead. I'm always willing to hear from candidates who think that they could help Trafford Housing Trust to achieve its goals, if that sounds like you, get in touch. 

Need, Demand and Politics in the Housing Crisis

It was a chance conversation in London and then a train journey home that got me thinking. We have a housing crisis in this country; everyone says we need 230,000 new homes a year (and possibly those projections will have to increase given the unexpectedly high increase in England and Wales' population revealed by the most recent census). Everyone also knows that if this is the level of need, then actual housebuilding hasn't kept pace. Homelessness is rising, but by nowhere near the levels that the mismatch between household formation and housing supply would suggest. So where is everyone actually living?  

Where exactly is everyone? Source

And that prompted me to think about need versus demand, two quite different concepts, with an inter-relationship that if not misunderstood is certainly under-reported. Housing need would be met by more building more houses. But not all housing need is actually housing demand, because not everyone in need has the purchasing power to get it. It is not a situation of "if we build, they will come" - if it was only that simple, we'd see housebuilders building out their landbanks not sitting on them. To turn it into any kind of active demand then there needs to be finance around it. 

Successive opposition parties have shown that you can certainly beat a government up on the issue of the shortfall of housing built against housing need. If there was real demand then builders would be building those houses and the problem would disappear. The only people who are creating demand in the market are already pretty well housed. If there was the political support (and the money in the public purse), more demand could be created by using public subsidy, but let's be realistic, for the next few years that's going to be in short supply. Witness today's apparent deferral till the Autumn of the housing element of the infrastructure initiative trailled in last weekend's papers.

So if meeting need isn't the driving force of housing policy, and demand can't be stimulated by subsidy, what are we left with? Two strategies are emerging:

First, if you believe what the housing minister said at the Institute of Housing conference, the new message is not how how new homes meet housing need, it’s this new metric that every 100,000 homes built adds 1% to GDP that counts with the "quad". So housing is being viewed as an economic engine and being able to house a few people is a useful by-product, not the end in itself. 

The second approach is to fill up the homes we already have. To some extent that must be what is actually happening to absorb the excess of need over demand and so is the most likely answer to my question of where is everyone actually living. There's an underlying message developing that the problem is with under-occupation. You can make an argument that we have more than enough rooms in this country, it’s just that many of them are empty – so people must be forced to make more effective use of their housing. 

In the absence of money to build, the government are noticing that there are large parts of the housing estate which are under-occupied. What they probably miss out and forget is that during the 1980s when allocation of public sector housing was done by numbers – so if it was a five person house you let it to a family of five people – the result was that the public services and the public realm became unable to cope: police, parks, schools – it just didn’t work.  

Cramming might just work to pass the exams that pass for an education, but every good housing manager knows it's bad policy for housing. As public service reform focuses on measures to reduce demand in the future, why are we and our residents being steered back to a policy of cramming that will have precisely the reverse effect. It's fairly tired thinking.

Leadership And Love

The Guardian Housing Network live chat I did recently has appeared on their site and it’s interesting to see just how much overlap on thoughts about leadership there was from the accumulated housing association chief execs. There’s clearly more agreement in the sector than it might sometimes seem. The overwhelming note sounded by the collected leaders was that the important thing for success is the team you surround yourself with.

Mick Kent from the Bromford Group set the scene: “Surround yourself with great colleagues: Recruit and develop colleagues that are better than you, especially those that tell it how it is and will let you know when you're on – or off – track.” Joe Chambers also made a good point with regard to staff development, “Staff who like the organisation will do a better job: Remember, the key question most people have is "what's in it for me?" It's a perfectly reasonable question and you must have a reasonable and honest answer.” My own point began with the question, “Are you sure you love people enough?”

Love might seem like an odd concept to even raise when it comes to a work-based discussion. Granted many people find their partners at work, (and I count myself amongst those who have got this particular t-shirt and worn it for many happy years) but it’s perhaps rare – and maybe even unseemly - when love gets mentioned. Love is for the home, surely? It's the sort of thing that we only apply to friends and family, isn't it? I’ll clarify: by love, I don’t mean romantic love and sending Valentine’s cards, I mean genuinely wanting what’s best for people. This takes some thinking through because you also need to want what's best for your customers and for your stakeholders  - and oft times those three seem to be pulling in different directions.

You’ve heard the maxim that if you love someone you should set them free. There’s more than a crumb of truth in that sentiment and countless books on empowerment are testament to the conventional wisdom that giving people your power enables them to achieve the freedom that comes when they reach their maximum potential.

The litmus test for this is when people do ask to be set free. In all the years I’ve been a chief executive I’ve often found myself in the position that all leaders hate. Where someone whose work you value and appreciate tells you that they’re moving on. This is the point where love is really demonstrated – you have to (regretfully) let these people go on and then champion them even after they’ve gone. You might well have experienced this sort of situation yourself and you'll know that a loving approach is by no means the only one. The alternative fuel for a leader is anger, but I’ve never really understood how these “angry” leaders survive. How much energy must it take when every day is a battle of attrition, every question a challenge to their authority?

Whichever approach leaders adopt there is one thing that we can all agree on: the vital first step is to bring in the best staff you possibly can. I've said before that I see this as one of my key functions at Trafford Housing Trust, attracting talent to the organisation, helping them achieve everything they can and getting out of their way. I'm very pleased to say that our office is currently awash with the next generations of housing talent. We’ve had work experience students in from Flixton Girls’ School and our 10 apprentices have been undertaking various challenges to see who will be awarded the five placements we have up for grabs.

This stuff is done by many housing organisations. It's stuff that makes our businesses stronger, it makes our communities stronger too. And unlike the private sector participants in the work programme, we do it for love not money.

Leadership Lessons From Bob Diamond

I've been thinking about leadership quite a bit this week - it's perhaps inevitable given the press coverage of Barclays. I should point out that I'm writing this before what I think is going to be an explosive Select Committee appearance from Bob Diamond on Wednesday afternoon (watch it live here). As Twitter is already suggesting, "massive bank account, no job to lose and a thirst for vengeance" could lead to nuclear-level revelations (which certainly seems to be the case if Diamond's daughter's Twitter account is genuine).  All of us who are privileged to lead dread the "no way out" problem Diamond faced. If he knew what was going on inside his bank he was complicit and a rogue; if he didn't he should have done and was a fool .

I'm sure that leadership in a technically complex, multi-national organisation like a bank is much harder than in any of the UK's housing associations; that's why they get paid so much more money than even the most highly paid CEO in our part of the industry. That's also, presumably, why the opprobrium over those salary packages is only heard from government ministers when things go so blatantly wrong, rather than for housing associations where the sniping about CEO salaries is indiscriminately applied to successful and unsuccessful alike. Anyone else remember A4E? And is there a common thread of greed here?

Greed is absolutely not what I think leadership is about. I've referred before to our Apprentice programme before and it's started this week. So we've got 10 budding Apprentices all eager and keen in our offices hoping to be one of the five youngsters we appoint to formal apprenticeships with us. They interviewed me today, perceptive and probing in their questions, one of which was about salaries. They were astounded when I told them that as CEO I got the same pay-rise as my staff; yet another example of our sector not getting its story out - because that's just what we do, isn't it?

So what does drive leadership in our sector? What makes for the best housing CEOs? There was an interesting Guardian Housing Network webinar this week where housing association CEOs discussed this very issue. The striking thing for me was just how much common ground there was between us that it was people and places that mattered to our sector's leaders, not profit. This was exactly the USP for our sector I had set out last week when arguing at the UN for the unique place of social housing in Real Estate Markets.

So as I dwell on just how much more I can learn from my peers - and for however long we've been doing it, we are still learning the job - I also wonder whether there might just be a few parts of the discredited capitalist world that could learn from our people-centred, customer-focused, values-driven leadership. Still, I'd be pretty sure it won't be one of us who get that call from Marcus Agius!