Unemployment Exchanges

Mauritius Times – 70 Years

By Peter Ibbotson

This year, 1960, marks the fiftieth anniversary of the opening of the first national Labour Exchange, which was renamed Employment Exchanges in 1916.

Before the state intervened to provide labour exchanges, such services were offered by voluntary organizations or local enterprises. The pioneer in this field was a Conservative, Nathaniel Cohen, who opened the first labour exchange in 1885 at Egham, Surrey, where he lived. However, it was the Fabian Society pioneers, Sydney and Beatrice Webb, who did more than anyone else to bring about the establishment of state-run labour exchanges. They supported the then Morning Post leader-writer William Beveridge in his campaign for such exchanges. Beveridge later left the Morning Post and joined the Board of Trade at the express personal invitation of the President of the Board, Winston Churchill. Churchill and Beveridge together created the state labour exchange system, and both men—now Sir Winston Churchill and Lord Beveridge—were still alive to witness the golden jubilee of their creation.

The primary function of the first labour exchanges was, like the employment exchanges operated by the Mauritius Department of Labour today, to facilitate the matching of employers seeking workers with individuals seeking employment. While the UK Employment Exchanges still perform this core function, several additional services have been introduced over the years. Every effort is made to match the right person with the right job, and vice versa. Vacancies that cannot be filled locally are advertised nationwide, and suitable candidates for remote jobs are referred in writing to employers. Each Exchange employs a Disablement Resettlement Officer, whose responsibility is to assist disabled individuals in securing appropriate work in industry, as well as to help seriously disabled persons find sheltered employment. Other services include vocational training programs, government-run training centers, and industrial rehabilitation centers.

In the first year of operation, 62 exchanges opened on the first day, and 94 more were added during 1910. By the end of that year, the exchanges had placed around 400,000 workers in jobs. In 1959, nearly 1,900,000 workers were placed, including school-leavers, who were served by a special division called the Youth Employment Service.

When Churchill introduced the Labour Exchanges Bill in Parliament, he also proposed the creation of a national insurance system, which was later formalized by the National Insurance Act of 1911. Initially, the scheme applied to a limited number of trades, including engineering, shipbuilding, and construction, affecting about 2.5 million people. However, with the outbreak of World War I in 1914, more workers—especially those in munitions—were quickly brought under the insurance system.

After the war, it became clear that the continuation of the labour exchanges was essential and inseparable from any system of unemployment insurance. Subsequent legislation extended the scope of unemployment insurance to more than 12 million workers, and the exchanges became the official point of contact for unemployed workers to receive their benefits. Registration as unemployed and regular attendance at the exchange were required to claim unemployment benefits. As Churchill had anticipated in 1909, unemployment insurance and the employment exchanges were complementary. This relationship was reaffirmed in Parliament during the establishment of the Ministry of National Insurance in the post-war period. As a result, the exchanges continue to register unemployed individuals and process claims for unemployment benefits.

During and immediately after World War II, for several years, individuals were not allowed to change jobs or obtain new employment without the consent of an employment exchange or an approved employment agency. Many workers, particularly in clerical fields, were reluctant to use these agencies, mistakenly believing they were intended only for manual laborers.

Currently, in Mauritius, there is no reliable method of determining the true level of unemployment. Employment Exchanges are seldom used; people register and attend for a few weeks but then stop, believing that there is no work available and that their time and money are better spent elsewhere. As a result, their registration lapses, and the Department of Labour considers them no longer unemployed. Mr. Luce estimated that there were about 30,000 unemployed people, despite only 2,000 registered at the Employment Exchanges. Some critics thought Mr. Luce’s estimate was too pessimistic, while others felt that his figure was not alarmingly high enough. Only through compulsory registration can we accurately assess the true unemployment situation in Mauritius, but we cannot expect unemployed individuals—often struggling financially—to spend their limited funds on transport to the exchange.

Professor Titmuss is soon to advise on a system of social security for Mauritius, and it is likely that one of his recommendations will be to make unemployment benefits contingent on compulsory registration at the employment exchanges. As history has shown, from the earliest days in the UK, registration and benefits have been complementary, and this is equally true for Mauritius.Read More… Become a Subscriber

Mauritius Times ePaper Friday 8 November 2024