The UK is lagging behind major competitor economies on tackling youth unemployment. The figures are striking: the number of young people out of work has increased at a much faster rate than the European average and the proportion of young people who are unemployed now stands at the third highest in the OECD, with only Spain and Greece experiencing worse levels. Yet it doesn’t have to be this way. Many countries have managed to maintain consistently low levels of youth unemployment despite the global economic crisis.
So we know that this is not just about the impact of the recession. Indeed, in the UK, youth unemployment was rising even during the preceding period of economic prosperity. Part of the reason lies in the changing nature of the economy, yet there is also evidence that policy responses in the UK just haven’t been effective enough, which is why we now urgently need to consider how other countries have kept youth unemployment low despite the recession. This is what new research from The Work Foundation published this week has set out to do.
For instance, in Denmark, despite rapid rises in youth unemployment over the recession, the level of long-term unemployment – which is associated with the worst ‘scarring effects’ – has remained one of the lowest in the EU. Part of the reason for this is the emphasis placed on early intervention as well as an ‘education first policy’ for those unemployed young people with low or no qualifications. In the UK, young unemployed claimants enter The Work Programme after 9 months of being unemployed. We argue that earlier intervention and more intensive support is needed, and that – as is the case in the Danish system –education and training should be prioritised over work for those with no qualifications
UK policy makers should also look to learn about what doesn’t work and why. Australia was one of the first countries to implement a ‘Work for Your Dole’ policy, which at best has been shown to be ineffective and at worst to actually reduce the chances of a person exiting unemployment. Similar results have been found from the UK’s own schemes such as Mandatory Work Activity, and unless sensitively implemented, current pilot initiatives aimed at young people such as Day One Support are also likely to fail. However, to be ready for the labour market, young people do need to have the opportunity to gain high quality work experience. That’s why we’re also calling on the government to reform and reintroduce Key Stage Four work experience to ensure that no young person leaves school without it.
But this is not just about asking the government to do more. We also need to encourage employers in the UK to support the development of the UK’s future workforce. In Germany for example, almost every large employer offers apprenticeships, compared to just a third in the UK, and they are actively involved in the design and delivery of training. We would like to see this kind of commitment replicated in the UK.
Ultimately, UK policy must be driven by the evidence on what works and what does not, and this means looking to those countries that have been more successful in tackling the problem. Unless these lessons are learned quickly, many thousands of young people will continue to face an uncertain future in the labour market.