A long period without work at a young age can have a long-lasting effect on a person's life chances, leading to a higher future likelihood of unemployment and lower future earnings. For this reason, UK policymakers should be particularly worried about the present level of youth unemployment. There are currently 868,000 young people aged 16–24 unemployed in the UK, and 247,000 of them have been looking for work for over a year.
This is not simply due to the financial crash and recession. While the last six or seven years have been particularly tough for the latest generation of young people, even before the financial crisis many of those entering the labour market for the first time were struggling to compete with older workers for jobs. This suggests that even a full-blown economic recovery is unlikely to solve the problem of youth unemployment in the UK.
The report makes a series of recommendations to address five critical policy areas, each of which requires a focused response.
- Employers are dissatisfied with the school-leavers who are applying to them for jobs, but a large part of the problem arises because employers are not prepared to be sufficiently involved in young people's training to ensure that they develop meaningful, useful skills. The best way to increase employers' engagement is to have them take a financial stake in the success of the system.
- Vocational education in England needs to be reformed so that it is held in higher esteem by employers and young people alike. As a pathway into work, higher-level vocational education should be seen as a valid alternative to a university education.
- Policy on apprenticeships in recent years has been dominated by a preoccupation with quantity, putting quality at risk. Apprenticeships should be seen by students and employers as a high-quality vocational route into work for young people.
- In those European countries that have low rates of youth unemployment, careers education and guidance play a crucial role in ensuring a smooth transition from education to work. Our recommendations focus on embedding and resourcing careers advice in schools, particularly at key milestone moments when young people make vital decisions about their future.
- The current benefits system fails to differentiate between the needs of younger umemployed people and older jobseekers, such as finishing basic education or receiving on-the-job work experience. We propose that a distinct work, training and benefits system should be established for young people.
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