For young people this budget has left one big question hanging in the air: how will we find work?
This year, both Labour and the Conservatives turned to the levers of Whitehall for their answers to mass youth unemployment – Labour with its jobs guarantee, and the Conservatives with their Work Programme.
Now George Osborne has announced his intention to provide enterprise loans for young people who want to start their own businesses.
But the state cannot create sustainable careers by creating vacant positions – or handing out cash. The current acceleration in joblessness is, in its scale, a symptom of the most recent recession. Yet we are growing into a world that presents young Britons with an increasingly competitive field, without the skills to survive.
We have all watched recent headlines on youth employment with growing alarm. But the OECD’s latest report on education (p.362) shows that the percentage of British 20-24 year olds in neither education nor employment has risen steadily almost every year since 2004: well before the credit crunch hit.
And this is no surprise when you consider what we are up against. What is our unique selling point in a world where a university education is fast becoming commonplace? The same report gives the UK a 4.7 per cent share of the world’s graduates (p.35). China stands at 12.1 per cent – and their figure is over 10 years out of date.
Our policy makers put much faith in Britain’s technological edge over fast-growing Asian economies. But as Evan Davis’ series ‘Made in Britain’ showed, what will stop Chinese manufacturers turning to Chinese designers, Chinese advertising agencies and Chinese marketers, instead of ours?
And the same technological advancements are working to eliminate another of our workforce’s biggest assets: their location. Why would you hire a costly paralegal in London when you can have a twice-qualified graduate in Hyderabad – prepared to work 2pm to 10pm to fit your schedule – for a fraction of the price?
The answer in all three cases, of course, is that we will only succeed if we are better. Better educated, better trained and better skilled. George Osborne repeated this well-worn adage in the opening paragraphs of today’s budget statement. So why do we all get a sinking feeling when we wonder: is the next cohort of British jobseekers going to be the world’s best?
And it isn’t only graduates we think of. Thanks to the EU’s doctrine of free movement of labour, school leavers without plans for university are faced with global competition on their own doorstep. They now suffer unflattering comparisons with their young European neighbours every day. On top of all this, those who can find work have seen the wages stagnate – and in many cases decline.
There have been a series of conflicting, ‘authoritative’ press releases from different think tanks on this issue in the last few months. So I hope this report from UCL’s Centre for Research and Analysis of Migration provides an easy way for non-mathematicians to make their own judgment: ‘each 1 percent increase in the immigrant/native working age population ratio led… to a 0.5 percent decrease in wages at the 1st decile, a 0.6 percent increase… at the median, and a 0.4 percent increase… at the 9th decile’ (p.22).
In other words, immigration reduces the wages of those at the bottom of the pile (the waiters, waitresses and construction site workers), while boosting those at the top (those who employ the waiters and builders). It makes sense – if you don’t have to pay out as much in wages, you can pay yourself more.
This is why, in spite of the controversy aroused by Lord Glasman when he spoke on this issue last year, I remain sure that we will have to revisit the UK’s position within the European labour market in the near future. The vast bulk of unskilled migration to the UK comes from the eight countries that acceded to the Union in 2004. Mass youth unemployment cannot sit easily alongside these facts.
However, protection is hardly a comprehensive solution to uncompetitiveness. At the root of the problem for both graduates and non-graduates alike is Britain’s failing education system. This isn’t only about money, as billions of pounds of investment in the last decade has shown. It’s about leadership.
We must unshackle teachers from their current position as prisoners in the classroom. No more lesson objectives, no more tick-box use of alternative media, no more threats of legal action when the only recourse is physical restraint.
Our children need to be able to think and communicate clearly. Their freedom in the long-term is ill-served by being allowed to run riot today. Teachers, like political leaders, must be free to focus on ‘energising people to work for a common purpose’, as my colleague Jon Wilson wrote last week. ‘Not just making rules and spending money,’ but ‘build[ing] institutions woven into the fabric of life’.
Parents and teachers alike have their part to play in making schools the economic crucibles that they should be. But it is our policy makers who must now bear the greatest burden – they created the culture in which my generation has been educated.
Schooling is the one chance we have to prepare children for the challenging world they now face: the place where people from all backgrounds mix; where our wisdom is passed on from one generation to the next; where we obtain the skills we need to support ourselves in later life. If we want young people to have work, we must make schools work too – and we can’t do that from the Treasury alone.
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Patrick Macfarlane writes the Blue Labour column on Progress and edits BlueLabour.org
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Photo: Elias Schwerdtfeger