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20% Youth Unemployment but What is the Real Figure?


Unemployment in Britain has surged by nearly 50,000 to nearly 2.5 million, including one in every five young people – putting the number of 16- to 24-year-olds out of work at close to a million, the highest since records of youth unemployment were first kept in 1992.

The rate of joblessness among 16-to 24-year-olds is now 20.3% , which is two-and-a-half times the rate among the population as a whole.

The reasons that young people are suffering are complex, and reflected across Europe. During recessions, employers are more able to pick and choose, so are more likely to hire trained staff for immediately productive. Young people also face competition from inexpensive and highly qualified workers from eastern Europe, while graduates have been taking school leavers’ jobs that they would not have considered a decade ago. Older people are retiring later, limiting vacancies.

Lower-skilled younger workers usually do badly in recessions, because they are the easiest to sack.
Hundreds of thousands more young people are thought to be in “hidden” unemployment, classifying themselves for example as students.

Other key unemployment measures gave a bleak picture, with the number of people in employment falling by 69,000 to 29.1 million. The employment rate fell to 70.4%, down 0.3%.

Most economists believe the jobless rate will gradually increase as spending cuts result in redundancies in the public sector over the coming months. While the private sector is creating jobs to replace them, they are largely part-time positions. The overall jobless claimant count defied expectations to fall by 4,000 people to 1.46 million.

In the longer term the only real answer is to encourage better literacy and numeracy at schools and more specific skills training for those more vocationally suited. Mind you this has been the case for a generation and there are no signs that the dumbing down of our education system is about to change. What is mind boggling is that the current state of our economy and education system seems to surprise those who are supposed to be in charge.

Just to rub salt into the wounds those in employment are also finding that their wages packets are increasingly squeezed. Total pay including bonuses rose by just 2.1 per cent from a year earlier. Regular pay, excluding bonuses rose by 2.3 per cent from a year earlier, partly bumped up by banks, and considerably below the Consumer Price Index measure of inflation, at 3.7 per cent. Economists describe this as good news: it will reduce the pressure on the Bank of England to raise interest rates and behind closed doors a bit of inflation is welcomed by the government.

 

Author: Chris Slay

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