The problem of youth unemployment in the UK is a disturbing one. The government is looking to its more youthfully active counterparts to see just how this frightening phenomenon can be addressed before long-term effects wreak further havoc with the economy.
Britain has a problem with youth unemployment. Almost a million young people in the UK are unemployed–the size of this group rose even during times of economic growth and despite far less youth unemployment in other recession hit economies. This according to Youth Unemployment in the Global Context, published by The Work Foundation, the second report of The Missing Million Programme aimed at increasing employment prospects of young people in the UK.
Long-term concerns
Between 2007 and 2011 youth unemployment in the UK increased from 9 to 12%. This was above the EU average of a 7 to 9% rise and OECD average of 6 to 8%. Whilst the UK labour market has improved slightly in recent months and youth unemployment figures have stabilised, the number of long-term unemployed young people has continued to rise so that over the past decade, the number of young people who are long-term unemployed has quadrupled.
Yet youth unemployment in Germany has been falling since 2005 and continued to fall during the recession; The Netherlands has managed to maintain a stable and low level of youth unemployment for the last decade; Although Denmark experienced a relatively rapid rise in youth unemployment over the recession it still has one of the lowest levels of long-term youth unemployment in the whole of Europe; and, Australia has experienced a decade of low youth unemployment rates.
The report examined a number of factors which could account for the differences, bearing in mind the complexity of valid comparison and asked what lessons could be applied to the UK in terms of policy choices.
Germany
Here the dual apprenticeship system facilitates transitions between school and employment. Several factors contribute to the success of the German model. These include its large scale and high quality training, high levels of corporate involvement, recognised qualifications and sustained investment in research and development.
Denmark
Expenditure on active labour market policies in Denmark is the highest amongst OECD countries. The government has prioritised education over a ‘work-first’ approach for young benefit claimants who have not completed formal schooling. The Danes have also built up considerable experience of what works and what does not in terms of labour market interventions.
The Netherlands
The Netherlands’ youth labour market supports high levels of youth employment. Although concentrated in what is often labelled ‘less desirable’ work areas, for many young Dutch people these jobs do act as stepping stones to permanent full-time contracts. The government has also acted to mitigate against the negative effects of non-standard employment contracts with increased employment protection, rights to training, wage guarantees and supplementary pensions.
Australia
The Australian economy has of course benefited from a long period of economic growth but there are still a number of young people who are finding accessing work difficult due to lack of relevant work experience. To tackle this Australia introduced the controversial ‘Work for your Dole’ initiative which was replicated by the UK amongst other countries. However, international evidence suggests a minor positive impact for voluntary schemes and no impact or even a negative one on future employment prospects if the scheme is mandatory.
Paul Arkwright
Publisher
