London: A Tale of Two Cities
Ceri Hughes and Lizzie Crowley
08 April 2014
The youth unemployment rate in London stands at 25 per cent. But this rate masks sharp disparities across the city region. Whilst the inner East of the city still fares poorly, outer London boroughs are now registering some of the highest rates of youth unemployment in London. This mirrors wider changes in the distribution of unemployment, and of poverty and deprivation more generally.
Regardless of the level of qualification held, young people in London had higher unemployment rates than young people in the rest of England in 2011. But whilst the prospects of young graduates have been affected by the recession, it is young school leavers who are most likely to struggle to compete against other highly mobile and skilled jobseekers. This suggests that there are particular factors that make it difficult for young people to gain a foothold in the London labour market.
This policy paper considers what is causing London’s high youth unemployment rate. In part, it is related to the characteristics of young people living in London, with high levels of poverty and deprivation in the city, particularly amongst some ethnic groups. We consider differences in labour market outcomes for young people from different ethnic backgrounds. In addition, the paper considers how the wider dynamics of the labour market and the level of competition for jobs affect young people’s employment prospects.
The paper covers the following areas:
- Considers which groups of young people struggle to get into work in London
- Setting out how outcomes vary for school-leavers and young people from ethnic minorities, and highlighting the areas that register the highest rates of youth unemployment in London;
- Assesses the level of competition for jobs in London and how wider labour market dynamics may impact on young people;
- Draws conclusions and offers recommendations on how to improve outcomes for young people in London.
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