Insights
At the end of June we ran our third workshop on local economic recovery from the pandemic, on behalf of CLGU.
The topic was youth unemployment and scarring (the long term impacts of unemployment). In our recent rapid evidence review on the topic, we said:
The evidence from previous recessions is that unemployment tends to rise more sharply for young people. Periods of unemployment when young, especially during recessions, can have long-lasting impacts on young people’s future labour market outcomes and on wider issues such as quality of life.
Sadly, this evidence is borne out by the data since the pandemic started. Naomi Clayton of the Learning and Work Institute presented sobering figures showing that young people are over-represented in the industries which have taken the hardest hit – hospitality and retail. Given this, it’s perhaps no surprise that while young people account for 12% of the employment in the UK, they represent 60% of those who have lost their jobs during the crisis. The number of people aged 18 – 24 claiming unemployment has doubled since March 2020.
Naomi had a number of suggestions from a policy point of view: that time on furlough be counted towards Kickstart eligibility; that a ‘Youth Guarantee’ be introduced to ensure that NEETs can access a job, apprenticeship, training, or educational place; and that local authorities play a leadership role in coordinating the support offer and helping young people find it and take it up – especially the hardest to reach groups.
Henry Overman reinforced these recommendations with the evidence-based guidance from our work. He reiterated the important role for local authorities in signposting the support that the government is offering, and helping young people understand and use it. He also stressed the need for places to maintain flexibility in their approach as the landscape changes over the next year and keep an eye on longer term policy investments in education and training.
Perhaps the most important message from both experts was ‘the quicker we can get them back to work, the better’. There is a clear steer from the evidence that longer periods of inactivity lead to worse outcomes for young people over their lifetimes.
The local authorities who were present added a lot of fascinating detail about what they are seeing on the ground. A common issue across a number of places is that despite a variety of programmes which follow the recommendations of our speakers, there was a sense of frustration that inactivity among young people is persisting in the face of labour shortages.
No one thought that there was a single reason for this reticence to enter the job market. Brexit may have reduced the pool of entry level and low paid labour in some places but has also exacerbated the uncertainty lockdowns have created. And some felt that the furlough has enabled a wait-and-see approach. Fear of the virus and a more general anxiety about interviews and new workplaces may be the most troubling motivational barriers.
None of these problems will be easy to solve. But the one thing on which everyone agreed was the importance of tackling these challenges with renewed urgency given the increases in youth unemployment caused by Covid-19.
For more detail on the evidence, and from the places about what they are facing, watch the video.
More information on our past and future events is there too.
