The latest unemployment figures make unpleasant reading. An overall unemployment rate of 8% is bad enough but is no way near as depressing as the 18-24 year old rate which now stands at an all-time high of 18.3%. The Chartered Institute of Personnel & Development argues that these figures are misleading. They suggest that the true rate is nearer 1 in 8 than 1 in 5 if taken in the context of the greatly increased proportion of young people in post 16 education. That may be so but I am reminded of something my dad once said to me, "If you are out of work you are 100% unemployed.2 With almost 1 million unemployed young people in this country, numbers matter more than percentages. So what can be done to get Britain working again, to take the Daily Mirrors campaign strap line?
It would help if we understood better why young people are so vulnerable in the labour market. There are lots of reasons suggested, a lack of work skills; a preference among employers for experience before potential; too high wage expectations; and, of course, minimum wage legislation. There are those who also think that there are structural changes taking place and what is emerging is an hour glass economy where there are professional and highly skilled jobs and unskilled jobs with nothing much any more in the middle. It is here that many young, inexperienced graduates have previously started their careers, particularly in admin and clerical jobs that did not necessarily require a degree educated worker but provided a very good induction into working life. Imminent cutbacks in the public sector workforce will only create an even larger vacuum.
Last week I was asked by a journalist if graduate unemployment in Britain was high because graduates could get by on state handouts? This surprised and shocked me. I am sure there are those who have adapted to life without work but my experience of graduates is the exact opposite. Many are desperate to work and are despondent when their ambitions are not realised. To get Britain's graduates working, we need:
> More internship opportunities
> More and better support and guidance during the transition from education to work
> Cash incentives for employers to recruit and train.
This last suggestion was contained in my association's pre-election manifesto where we called for tax breaks to encourage employers to recruit graduates entering the workforce for the first time. In particular, we pointed to aid for small and medium sized enterprises and to the third sector. If I had the ear of the Chancellor as he prepares his budget this is what I would advise him to do. SMEs form a major part of the British economy and many would benefit from recruiting graduates who in return would benefit from being employed. Recruiting and training is an expensive business and any relief that firms can obtain for investing in young talent would surely act as an incentive?
Everyone recognises that the country is short of cash and tax breaks do not come cheap but then the social security bill would fall and, even more importantly, graduates would pay income tax. It's a small price to pay in the short-term for significant longer-term gains for UK plc. Next week we will discover what the Chancellor proposes in his spring budget. We must hope it is a budget for jobs.
Carl Gilleard
