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Dr Neil Lee
Head of the socio-economic centre
T 020 7976 3611
Dr Neil Lee

Youth Contract welcomed but it's a short-term fix

Authors: Dr Neil Lee Dr Neil Lee

02 April 2012

The government’s Youth Contract goes live today. This is a response to concerns about rising youth unemployment, which reached a million last year. The scheme includes wage incentives of around £2,275 for 18-24 year olds who have been out of work for some time and 250,000 work experience placements. There will be more money to ‘incentivise’ apprenticeships and an additional fund (£126 million) to get teenagers who are NEET into education, employment or training.

It is hard for Labour to disagree with this, so they’re raising the bar: Ed Miliband is calling for a jobs guarantee for young people, paid at the minimum wage . But Labour are having difficulty explaining how they would pay for their scheme, and how it differs from the Future Jobs Fund (although some think this isn’t a bad thing).

The youth contract is a good scheme, and a jobs guarantee would be useful (if expensive). But both sets of schemes are short term fixes. Youth unemployment has been rising since around 2001 and, while the problems of the recession need to be addressed, we should also consider the longer-term problems faced by young people in this country.

In the UK, we’ve put in place good routes into work for the academic elite. But we’ve not providing routes from education into the labour market for those who don’t want to go to University. The challenge is to use this short-term emphasis on youth unemployment to address this in the long-term.

We’re considering these issues as part of our Missing Million research programme. Get in touch if you want to hear more.

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