Under the Employment and Training Act 1973, the Manpower Services Commission was set up to develop a comprehensive manpower strategy for Britain and to advise the Secretary of State on employment matters. The Department of Employment was to oversee the activities of the Commission, which took over two other bodies established in 1972 as divisions of the department:
- Training Division, which included the Training Services Agency planning team and Corporate Services Branch, was placed under the aegis of the Commission in April 1974; and
- The Employment Service Division, including its Professional and Executive Recruitment Branch, which came under the supervision of the Commission in October 1974.
The Commission consisted of nine members and a chairperson, all of whom were appointed by the Secretary of State. Of the nine members, three were appointed to represent the interests of employees, three to represent the interests of employers, two in consultation with local authority associations, and one to represent professional education interests.
In addition to training, its functions included responsibility through the Employment Services Agency for jobcentres. Jobcentres performed the job-finding function of employment exchanges, while the burden of administration of unemployment benefit remained with the Department of Employment as the work of Unemployment Benefit Offices (UBOs). The first jobcentre appeared in April 1973 in Reading, Berkshire (although an experimental"self-service jobcentre" had operated in Tottenham, London, a year earlier), and by 1975 four hundred jobcentres had been opened. The Commission also inherited responsibility for the industrial training boards and for the planning of training services for industry.
The Employment Service Division operated as a statutory body, known as the Employment Services Agency, up to 1978 - when it was reformed as an official division within the Commission. The division's main functions centred around: the development and provision of services for adults, young people and the disabled through the national network of Jobcentres and Employment Offices; assistance through job placements, guidance services, and employment rehabilitation; and the development of professional and executive recruitment services through a network of professional and Executive Recruitment (PER) offices. The division was renamed the Employment Division in 1982.
When responsibility for the Employment Service Division was transferred to the Commission, administrative responsibility for all its local offices was centralised under a chief executive. In October 1977 the responsibilities of the Department of Employment in Scotland and Wales for planning, research and oversight of the careers services passed to the Scottish Office and the Welsh Office. The posts of Department of Employment directors in Scotland and Wales were discontinued and the Commission appointed manpower services directors in Scotland and Wales to act for and advise the ministers. In December 1977 similar appointments were made in the English economic planning regions. The department retained administrative control of redundancy payments, unemployment benefits, youth employment subsidies and related matters.
In April 1978 the operations of the Commission were integrated. The Training Services Agency disappeared as such, but its services continued to be provided by separate operational divisions of the Commission. Their executive committees, which were responsible for policy matters and performance monitoring, continued to exist.
The national jobcentre network and the functions of the Employment and Enterprise Group of the Commission were taken from the control of the Commission and merged with the Unemployment Benefit Service in October 1987 to reconstitute the Employment Service (which later became an executive agency). Having lost its employment functions, the focus of the Commission was concentrated on the government's training and vocational education programme, and it was re-named Training Commission in May 1988. In September 1988, it was abolished, and the Training Agency was created to perform its functions as an executive agency within Employment Department Group. The Training Agency was wound up in November 1990 and its functions were re-integrated into Employment Department.