For young people without a degree, it's only getting worseby Spencer Thompson / May 15, 2013 / Leave a comment
The jobs figures released this morning continue to show the UK labour market teetering on the brink. Whereas in 2012 the economy managed to create over 350,000 jobs, in the three months to March employment fell 43,000. But the picture for young people is much more complicated. The headline youth unemployment rate fell slightly in the latest data, although it remains dizzyingly high at one in five young workers. But this figure conceals a growing disparity between different groups of the youth population, some of whom are much better insulated against job losses than others.
The key is education. Despite the attention given to graduate unemployment, the group most at risk of long-term worklessness and labour market scarring is those who are not going to university. In the last three months the number of young people who are in both full-time education and work rose by 18,000. But the rise in the number of those neither in education or work is even higher: 22,000. It appears that the jobs available to young people are going to those who are also studying, rather than to the growing ranks of inactive youth.
The qualification levels of young people also matter. In the last quarter of 2012, one in four young workers with five good GCSEs, and a staggering 40 per cent of those with no qualifications, were unemployed. In comparison, the graduate unemployment rate was just 13 per cent. With no end to the UK’s labour market stagnation in sight, those young people without a degree or not on a university track face a very grim future indeed.
We need to put young people back to work. The coalition’s wage incentive scheme aimed to do this, but the early evidence suggests that it is actually doing very little to create new jobs, with only 9 per cent of employers creating vacancies as a direct result of the scheme. Instead, we should adopt a job guarantee for young people, with an offer of work experience to all those out of work and on jobseeker’s allowance for a year or more. It should be paid at the minimum wage in order to allay the justified concern with earlier “workfare” schemes. But…