14th June 2012 Blog
First published at the Labour Lords blog
In the last two months, Peers have spent 25 hours debating House of Lords reform. Today they will spend two and half hours debating youth unemployment, and only one backbench Conservative is taking part. That doesn’t say much about the Government’s priorities, particularly in tackling what Nick Clegg has called “a ticking time bomb for the economy and our society”.
The situation is dire. There are the 954,000 under 24 year olds not in employment, education or training. Most concerning of all are the 167,000 under 24s who have been unemployed claimants for more than 6 months, a number which has more than doubled since last April; and the 61,000 who have been claiming for more than 12 months, a number which has more than trebled in the last year.
There are three priorities for action.
First, young people need more job opportunities to be available, as soon as possible.
Second, young people need better preparation and motivation for work. There needs to be new vision for what Acevo, the voluntary sector organisation, calls the “forgotten half of young people who are not destined for university or a high quality apprenticeship post-16”.
Third, unemployed young people need the support of a far more active welfare state to help them get into work and stay there.
More jobs and training is the most urgent requirement. Stronger incentives are needed for employers to recruit unemployed young people. The government, after first scrapping Labour’s ‘Future Jobs Fund’, has now recognised the need to do more. Hence the new Youth Contract, offering 160,000 wage subsidies of just over £2,000 for each new private and voluntary sector job given to a long-term unemployed young person, over this year and the next two.
The Youth Contract represents 53,000 work opportunities over the coming year, which is not much in the face of the 167,000 who have been unemployed claimants for more than 6 months – even if all such opportunities all created.
However, the big numbers in the Youth Contract are for work experience placements, with 100,000 promised this year. I strongly support work experience, provided young people are treated properly. But even if these places materialise, they are of short duration – as little as two or three weeks – and no substitute for real jobs paying real wages.
We need to go further than the Youth Contract. Hence Labour’s proposed Real Jobs Guarantee for under 25s who are long-term unemployed. For those out of work for more than a year there would be six months paid employment, with the state providing wage subsidy for 25 hours of work and the employer covering the cost of 10 hours of training each week.
If the Youth Contract doesn’t rapidly reduce the number of long-term young unemployed, the Government should adopt our Real Jobs Guarantee, and the bankers’ bonus tax which makes it possible. Or Nick Clegg’s “ticking time bomb” will explode, long before the Lords is reformed.