When Youth Futures Foundation launched its grants programme earlier this year, we couldn’t have anticipated the Covid-19 pandemic and the scale of the impact on the economy, but we did know that young people would be disproportionately affected. In previous recessions unemployment rates for young people have risen three times faster than for older people. Between March and May the number of under-24 year olds claiming Universal Credit almost doubled to nearly 500,000, but we know many do not claim and the number of unemployed closer to one million.
Evidence shows that unemployment at a young age has long-term scarring effects on young people’s careers leaving them earning less up to a decade later, more vulnerable to unemployment in the future, not to mention the impact on their mental health and well-being. Those who have been unable to complete their education due to lockdown measures or are entering the job market with low-level qualifications and little or no work experience, are especially vulnerable.
The nature of this crisis has hit sectors such as hospitality and retail hardest, areas which employ a higher proportion of young people. With around 750,000 already not in education, employment or training (NEET) and a further 700,00 leaving education and entering the job market this year, the outlook was bleak.
Youth Futures Foundation came together with partners including , , the and , to form the to propose a series of measures to mitigate the impact of this crisis for young people and we are delighted that the Government has listened and responded.
Today we are delighted to welcome the package of measures announced today by the chancellor, Rishi Sunak. The £2billion Kickstart Scheme will encourage employers to offer six month job placements with training and support, with the Government covering the cost of 25 hours’ work a week at the National Minimum Wage, potentially creating hundreds of thousands of job for 16 to 24-year-olds. Apprenticeships are given a boost with the Government paying employers £2000 to take on young apprentices.
For 18-19 year olds leaving school or college the Government is providing £100m to create more places on level 2 and 3 courses in high demand sectors like engineering or social care. We also called for enhanced careers services to ensure young people had access to the information, advice and support they need to access work. The government has responded with £32million investment in the National Careers Service and £111million to triple traineeship opportunities.
The chancellor said:
‘Young people bear the brunt of most economic crises, but they are at particular risk this time because they work in the sectors disproportionately hit by the pandemic.
‘We also know that youth unemployment has a long-term impact on jobs and wages and we don’t want to see that happen to this generation. So we’ve got a bold plan to protect, support and create jobs – a Plan for Jobs.’
The Future Jobs Fund launched during the financial crisis in 2009 was shown to have been effective not only in securing jobs and the futures of young people, but delivered huge benefits through tax receipts and a reduced benefits bill. Not to respond on a similar scale and waste the talents of a generation could never have been an option.
While we welcome today’s good news, we are mindful of the scale of the challenge we face. The Bank of England predicts a 14% slump in GDP and when the furlough scheme closes at the end of October, the full scale of unemployment levels will become more apparent. Youth Futures Foundation is committed to supporting those young people who are most vulnerable, most disadvantaged and face the greatest discrimination when making the transition into work.
We must ensure the jobs created by the Kickstarter scheme are of quality and offer the young people who secure them the opportunity to develop their skills and experience to equip them for their future careers. Careers and job coaching services need to be cohesive and respond to the needs of young people. But the chancellor’s recognition of the value young people bring to our economy and society is well worth celebration today.
Chief Executive of Youth Futures Foundation, Anna Smee, commented:
‘We are delighted that the Government has been listening. The proposed measures, outlined in the Chancellor’s statement today, particularly the new Kickstart Scheme, mirror the calls to action made by Youth Futures Foundation and our partners in the Youth Employment Group. Young people have been disproportionately impacted by Covid-19 potentially leaving around a million not in education, training or work.
‘This incredibly bold £2 billion programme could secure jobs for hundreds of thousands of young people. We now want to ensure that the most disadvantaged and vulnerable young people are able to access support to enable them to successfully negotiate the transition into the world of work and fulfil their potential.’