2022 Key Trends in Welfare

Within weeks, governments and welfare systems successfully set up streamlined legal frameworks and delivery mechanisms to process and distribute huge volumes of economic support to businesses and individuals, protecting economies from disaster, enabling otherwise healthy firms and their employees to survive and safeguarding countless millions of households and families.

These achievements have demonstrated that there is huge potential for welfare systems – and the public sector as a whole – to leave legacy infrastructure, mindsets and ways of working behind, to move from reactive to proactive, and to once again become agents for change, delivering transformational social, economic and environmental policies.

1. Moving from reactive to proactive: Predicting employment and welfare needs

We are living in an era of fundamental change. The re-engineering of entire industrial economies to meet the imperative for sustainability is already underway. Meanwhile digital technologies and the advance of automation continue to reshape the skills market and future of work in every sector. It remains challenging to predict how long the pandemic will continue and what its long-term impact on employment patterns will be.

During COVID-19 we saw how welfare systems enabled government to close and re-open targeted areas of the economy. In 2022 policy makers will be considering how these systems might operate on a more proactive basis to assess and predict labor market needs in the future, and to enable citizens to acquire the skills that are most in demand, now and in the future.

The result of a more visionary approach, informed by the insights emerging from data and artificial intelligence, is likely to be more well paid, rewarding jobs with prospects, in today’s new industries. And digital profile screening technology will match more candidates to jobs, producing a corresponding reduction in the welfare burden, freeing resources for other spending priorities.

Moving to a four-day week and the introduction of a universal basic income are policy options under discussion in several European countries. In some countries a lasting consequence of the pandemic could be a more proactive welfare system making moves to intervene and redistribute, rather than simply providing a basic safety net.

2. Digital identification systems will increasingly ensure the right people get the right support

While so many welfare agencies quickly mobilized the necessary approvals, processes and resources to get financial support to those who needed it most, their success highlighted the urgent need for the universal application of single digital identification systems for all citizens, to provide the confidence that the right assistance was getting to the right people, at the right time.

A secure, personal ID recognized by all government departments and agencies, alongside robust digital infrastructure, has the potential to transform the lives of people everywhere, especially vulnerable groups and those most in need, such as the poor, casual or migrant workers and those living in remote areas, with little or no formal contact with public authorities.

Digital ID systems with robust governance enable public authorities to analyze huge volumes of data, informing evidence-based service improvements and additional features and integrations, benefiting citizens, economies and social inclusion.

While some countries require a foundational ID system so all people can prove their official identities, others, including Australia, Canada, and France, are beginning to create entire digital ID ecosystems that give people a choice of public and private sector ID providers.

With the World Bank investing $1.2 billion in more than 30 developing countries to reduce the number of unregistered people and to build better digital ID and civil registration systems, 2022 will see significant progress in this important area.

3. Focus on human centricity will signal a philosophical shift from laws to services

Public authorities’ high-speed response to the coronavirus crisis has accelerated a philosophical debate that will gather further momentum in 2022. The concept of human centricity – putting the wants, needs and motivations of individuals at the heart of decision making – is not new. But the success of the COVID-19 response has demonstrated that traditional norms need no longer apply.

For many citizens, the public sector’s seemingly built-in complexity and inertia is no longer acceptable, because now there is evidence that the alternative is not only possible, but achievable. Workable solutions that might previously have taken months or even years to launch were delivered in just days.

Citizens are now increasingly expecting their public authorities to make a step change, to be human centric, to provide services rather than enact laws, to support rather than punish, recognizing that the vast majority of citizens needing help are simply experiencing the realities of challenging life events – such as unemployment, poverty, relationship breakdown or bereavement – rather than criminals trying to defraud the system.

4. Synergies between central and local government will deliver better connected welfare

On a similar theme, human centricity in welfare means much closer synergies between national and local welfare organizations. Currently, in many nations unemployment benefit services are delivered by a central government department, with welfare payments handled separately by municipalities.

The disconnect is both costly and inefficient for the state, and disheartening for the individual, compelled to keep retelling their story to public authorities, who seem unable or unwilling to talk to one another.

An integrated employment and welfare ecosystem, accessing secure digital identities, will not only save precious resources by eliminating wasteful duplication of effort and infrastructure, but is also much more likely to match jobs with jobseekers. Once again, the skills, the technology and the political will are readily available – in 2022 citizens will increasingly demand that their elected representatives and public servants make it happen.

5. Workforce and welfare planning will have a role to play in reducing climate change

The lockdowns and restrictions of the past two years, while absolutely essential for the preservation of public health, have produced major challenges for politicians trying to protect their economies, for businesses trying to stay solvent, and for individuals fearing for their jobs, their homes and their families. And while the many social and financial support and assistance schemes have been enough to provide protection for most, they’re not sustainable in the long term because of their enormous cost.

But the support model that has been established to respond to the COVID emergency could yet have another positive role to play, a thought that will gather pace and take more concrete shape in 2022. Events of the past two years have, to some degree, taken attention away from our other global emergency, climate change. As our need for radical action to cut emissions and get on track for Net Zero continues to grow, major shifts in industrial strategy, workforce and skills may be unavoidable.

In our most polluting industries, it is increasingly worth considering what role welfare systems, such as COVID-19 furlough schemes, could play in enabling a managed transition from fossil fuels and other unsustainable industries to renewables.

Further reading:
Harnessing the power of digital ID (worldbank.org)

For information about Capgemini’s welfare services, visit here.