Monday, 14 November 2011

The reasons behind youth unemployment

Over on the FT's blog today,Kiran Stacey tackles the question of why we have so such youth unemployment and what cab=n be done.

With figures on Wednesday likely to show unemployment among 16-24 year-olds is expected to top 1m people, its highest since records began in 1992,Kiran looks at the work of Prof John Van Reenen of the LSE’s Centre for Economic Performance who suggests a few possibilities.

1.Immigration and the question of whether young people's jobs have been taken especially by the influx from Eastern Europe to which he says no.

2.the fact that Labour shifted the emphisis of its new deal away from youth to single parents back in 2004 which may have been a reason for youth unemployment to start rising again.

3.The minimum wage was extended to cover 16-17 year olds but again he dismisses this

4.The fact that wages for qualified people have been rising too, more quickly in fact than those for relatively unskilled people. This would suggest there has been a boom in the demand for skilled workers, which might count against young people with less experience.

but most of all he claims there has been a shift in focus on the part of job centres from young people to lone parents and those claiming IB.

If that is the case, perhaps ministers should look a less at education and more at the benefits system for how to avoid creating a “lost generation”.

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