The worst economic and social crisis faced by Britain was highlighted by the Guardian in this piece over the weekend telling of a new peak in youth unemployment. The problem might have been around for a few years, but the size and scale is different now. Who now doesn’t know someone who’s just left school or university and can’t get work? Not one of us. And today we have confirmation from the Office of National Statistics of the seriousness of the situation – unemployment among 16-24-year-olds now stands at 991,000, or 21.3 per cent, the highest level since comparable records began in 1992.
The signs have loomed large for some time. In September, my parliamentary boss Gordon Brown set out his own global warning on the phenomenon that sees young men across the world identify unemployment and social injustice as a key reason for joining gangs.
The figures referred to by the Guardian are the estimates of unemployment. This is the wider International Labour Organisation definition which includes everyone looking for work, whether or not they are claiming support from the government.
But if you want to understand the false economy of British unemployment, take a look at a couple of questions I asked of the Department of Work and Pensions over the past year. These numbers relate to 16-24-year-olds claiming job seeker’s allowance. In other words, these are the people for whom taxpayers are subsidising economic failure. Each and every person claiming JSA makes the budget deficit worse, not better.
Back in January 2011, after six months of Tory-led government, I asked the DWP for their business planning projection of the number of young people they would be paying job seeker’s allowance to in 2015, by the end of this parliament. The answer came back: 279,000. When you take into account a gently falling population of 16-24-year-olds this is a reduction of less than one percentage point from today – from 4.7 to 3.8 per cent claiming JSA.
And since then it’s got worse. In July I asked the same question again. The DWP now projects that the 2015 youth JSA claimant rate will be as high as 303,000. 24,000 more young people claiming rather than earning added to the government’s own calculation from January to July.
Unlike older people, who might have years of work experience under their belt but need to retrain, these young people are falling back on public funds before they’ve had the chance to join the workforce and pay their way. Can the government really be satisfied that their economic policy is doing right by young people or the taxpayer? Could they be doing more to get young people to work?
The figures above come with a DWP warning that they do not take into account the impact of the work programme, which has just replaced the New Deal, the flagship programme that dealt with the hangover of unemployment left by the 1990s recession. But while ministers talked about introducing ‘the biggest ever welfare-to-work programme’, Channel 4’s Cathy Newman in her Fact Check blog pointed out this was just not the case. The impact of the work programme cannot be assumed to be greater than the New Deal, especially when the New Deal operated in a largely growing labour market with jobs available once skills and experience were gained through the programmes.
Because the impact of temporary unemployment in a recession has long-term harmful effects, especially on the young, the Future Jobs Fund was established during 2009. It was a straightforward subsidy for employers who took on young people – unthinkable back in 1997, but changed times called for new measures at the height of the crash.
105,000 individuals across Britain took up jobs at a time when the labour market was very extremely challenging. Internal DWP evaluations of FJF shows high levels of satisfaction with the programme, and in my own constituency I’ve met those whose lives it changed.
That’s why the answers I received are so worrying. Government intervention has to do more than just implore business to hire, at a time when low confidence makes it increasingly unlikely. From axing the Future Jobs Fund to scrapping the education maintenance allowance and cuts to careers services, my figures show that the chancellor seems happy to pay more dole to 16-year-olds tomorrow than lose face today. The chancellor can wax lyrical about riding out the storm if he likes, but we’ll all remember who was at the helm come 2015. Big mistake, George. Huge.
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Alison McGovern is MP for Wirral South
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16 yo don’t get dole.
A reason for joining gangs and Gordon Brown taking money while refusing to go to work, bit rich.
Labour had the new Deal from America, but they took out the bits that made it work, Pathways to work was another of Labours great idea a failure again because the real bits which made it work in America was removed by Blair or Brown. Workfare was another and the one we have now. Labour goes on about the future fund hype total hype what we need is for jobs real jobs to come back not the bankers finance, we need to get back to making things in the UK, not just cars.
A reason for joining gangs and Gordon Brown taking money while refusing to go to work, bit rich.
Labour had the new Deal from America, but they took out the bits that made it work, Pathways to work was another of Labours great idea a failure again because the real bits which made it work in America was removed by Blair or Brown. Workfare was another and the one we have now. Labour goes on about the future fund hype total hype what we need is for jobs real jobs to come back not the bankers finance, we need to get back to making things in the UK, not just cars.
This truly is shocking statistics. I cant believe it. There are so many things which our current government keep from us. More and more young people will be unemployed by 2015 and the facts are getting worse. I was unemployed myself until recently when I managed to secure a media job. There are lots of opportunities in the IT and Media industries however they are very difficult to get into. I think you will find that if you look at the unemployment stats for Northern Ireland they are alot worse of there. There are hardly any NI jobs available.