Chancellor Rishi Sunak has announced a range of measures to support young people into jobs, including apprenticeships. 

He has also pledged £101 million so 18- and 19-year-olds in England can study “targeted high value” Level 2 and 3 courses if they face unemployment.

In his statement on the government’s plans for the economy amid the coronavirus pandemic today, Mr Sunak said apprenticeships “worked”, with 91 per cent of apprentices staying in work or doing further training afterwards.

He said: “For the next six months, we are going to pay employers to create new apprenticeships. We will pay businesses to hire young apprentices with a new payment of £2,000 per apprentice and we will introduce a brand new bonus for businesses to hire apprentices aged 25 and over with a payment of £1,500.”

News: Traineeships to get £111m boost from Treasury

More: Chancellor to announce £2bn job scheme for young people

Background: Apprenticeship starts almost halve during lockdown

He added: “To support 18- to 19-year-olds leaving school or college to find work in high-demand sectors like engineering, construction and social care, we’ll provide £100 million to create more places on level 2 and 3 courses.”

Coronavirus: New apprenticeships

Mr Sunak stressed the significant impact that the crisis has had on young people. He said: “Over 700,000 people are leaving education this year and many more are just starting out in their careers. Coronavirus has hit them hard. We cannot lose this generation.”

The chancellor announced a £2 billion “kickstart scheme” to create work placements for young people, first reported yesterday, which he said would give young people “the best possible start”. 

The scheme will subsidise six-month placements for young people on Universal Credit and at risk of long-term unemployment, with the government covering 100 per cent of the national minimum wage for 25 hours a week.

“These will be new jobs,” said the chancellor, “with the funding conditional on the proof that the jobs are additional. These will be decent jobs, with a minimum of 25 hours a week paid at least the national minimum wage, and they will be good quality jobs with employers providing kickstarters with training and support to find a permanent job.”

He explained that he was making available an initial £2 billion in funding, but he committed that there would be “no cap on the number of places available”. 

He also confirmed a £111 million investment to triple the scale of traineeships in 2020-21, which means businesses will receive £1,000 for every trainee they offer a work placement to. 

“Traineeships are a proven way to get young people ready for work. We know they work, so for the first time ever, we are going to pay employers £1,000 to take on new trainees,” Mr Sunak said.

Careers funding

Other measures announced by the chancellor today included funding for careers advice for a quarter of a million more young people, and £17 million of funding for sector-based work academy placements in 2020-21. “The evidence says careers advice works, so we will fund it,” said Mr Sunak. 

“Sector-based work academies provide training, work placements and a guaranteed job interview in high-demand sectors. The evidence shows they work, so we will expand them, tripling the number of places,” he added. 

For colleges, the chancellor confirmed the £200 million in capital funding previous announced by prime minister Boris Johnson - bringing forward plans for £1.5 billion of investment over five years set out in the Spring Budget. 

Shadow chancellor Anneliese Dodds said the Kickstarter scheme was similar to previous initiatives introduced by Labour, and it must ensure genuine opportunities for young people. 

The sector’s reaction 

David Hughes, chief executive of the Association of Colleges, said that in many ways the chancellor has delivered on the ask for “bold action” - but that it was disappointing that there was little for adult education. 

He said: “However, we need to see more of the details and, vitally, how this all fits together, particularly how education and skills provision are part of the package, particularly within the Kickstart Scheme and for adults.

“For young people, for adults, for advisers and for employers, the range of incentives are potentially bewildering. We will work with colleges and with DfE [the Department for Eduacation] and DWP [the Department for Work and Pensions] to make this more coherent, so that the incentives work for the widest range of people and employers in all circumstances.

“It is disappointing that there was little for adult education today. Despite the chancellor’s bonus to retain furloughed workers, we expect many to be facing redundancy in the autumn. For that group and unemployed adults, we wanted to see a stronger package of training to help them be successful in a very different post-pandemic labour market. Their needs are different to young people, with funding needed for more intensive training, higher-level skills and support to move sector.  

“Beyond this, we remain deeply concerned about the financial health of colleges. College leaders will need certainty that the right rules, regulations and funding will be in place to flexibly support young people, adults and employers to get what they need. Colleges are vital parts of the infrastructure which is needed to ensure the success of these packages, and particularly to reach all parts of the country and every community.”

Mark Dawe, chief executive of the Association of Employment and Learning Providers, said: “To borrow the prime minister’s words, it appears that the government is using both traineeships and Kickstart to principally target young people in the NEET [not in education, employment or training] group and make them ‘oven-ready’ for the world of work and a full apprenticeship. We welcome the clarification which will help providers plan their provision for September.

“Ultimately, the take-up for these programmes will be determined by employers, but AELP is very pleased that skills for young people are now on the top table in terms of the government’s priorities. This week has seen some very positive developments and providers are ready to play a major part in supporting them.”

Tackling youth unemployment

Kirstie Donnelly, chief executive at City and Guilds Group, said that the new interventions have the potential to tackle unemployment and help boost productivity, but only if they genuinely lead to new skills and real jobs at the end.

“The Kickstart Scheme, in particular, is a concern if the young people offered them do not come out with some official recognition of the skills gained to allow them to get a job elsewhere, or better still, the guarantee of a job at the end of it. If this is not the case, it’s just a sticking plaster solution or even a ‘revolving door’ back to the unemployment queue. 

“While it’s encouraging to hear the chancellor announce investment in job centres, if we are to truly counter rising unemployment, we must provide people with the support they need to gain the right skills to access meaningful employment in their region that lasts beyond a six-month guarantee. And we desperately need adequate levels of funding to pay for this.”

Bill Watkin, chief executive of the Sixth Form Colleges Association, said that the chancellor had taken “some welcome” steps. 

He said: “The one-year, high-value courses for school and college leavers are of particular interest to us - applied general qualifications will be an ideal fit for many young people, so this initiative may provide further evidence of the vital role these qualifications play, and cause the government to reflect on its future plans for AGQs. It will be important to address the funding reduction for 18-year-old students to ensure colleges and school are not financially penalised for delivering these one-year courses”.

Fiona Aldridge, director for policy and development at the Learning and Work Institute, said: “The government took unprecedented action to protect jobs and incomes at the outset of the crisis. It must now ensure that the measures to sustain and create jobs are as big and bold as the challenge that we face. But with more job losses announced daily and with 700,000 young people about to leave education, we must also ensure that these measures are implemented quickly.

“While we welcome a focus on encouraging employers to return their furloughed workers, we have called for more investment in an employment and skills package for those who are at risk. Even with the bonus, many workers will face the need to switch jobs or change careers and we must ensure that they have the right employment and skills support to do this well.”

Neil Bentley-Gockmann, chief executive of WorldSkills UK, welcomed the fact that young people were at the heart of the government’s plans for the recovery.

He said: “While this is rightly a numbers game, to try to help as many young people as possible, we mustn’t lose sight of the fact that we need quality as well as quantity.

“The quality of opportunities on offer through new traineeships, work placements and apprenticeships will be key to developing much-needed employability skills and motivating more young people to pursue rewarding careers in sectors which are vital to the economic recovery. We have to keep an eye on both the short-term fixes and long-term goals to help the next generation succeed in work and life.

“That’s why we are working with our world-class experts on new digital careers and skills resources to support some 200,000 young people to develop the skills set and mindset they need to reach their potential and secure sustainable employment.”

David Robinson, director of post-16 and skills at the Education Policy Institute (EPI) think tank, said: “The series of measures announced today by the chancellor to boost young people’s skills and employment opportunities are welcome, given the long-term scarring effects of youth unemployment on life chances.

“But as well as supporting them into jobs, it is also essential that we see bold plans to encourage young people to remain in education. It may not have featured in the chancellor’s speech today, but the £101 million package set out by the government to encourage 18- to 19-year-olds to study targeted level 2 and 3 courses is also vitally important.

“The government should continue to look at ways to support young people into continuing education, including offering learning maintenance support to those on post-18 courses in further education. FE in this country has been underfunded for decades - now is also the time to provide the sector with a more enduring financial settlement.”

Ian Pretty, chief executive of the Collab Group of Colleges, said: “It is evident that further education colleges have a pivotal role to play in delivering the policy commitments outlined today.”

He said it was vital Kickstart placements “give young people the opportunity to develop their skills and progress either into sustainable employment or continuing their education and training”.

“We also welcome the announcement of employer incentives to take on new apprentices. While it may fall short of an ‘apprenticeship guarantee’, it represents a significant policy intervention. We hope that the incentives provide employers with a renewed impetus to offer many more apprenticeships, which have fallen dramatically since the pandemic hit. We are similarly supportive of the proposals to inject £111 million into the traineeship programme. Again, however, it will be important that these programmes provide genuine skills development and progression opportunities for young people.

“Finally, we welcome the extra support of £1 billion to the Department for Work and Pensions to support unemployed workers. Colleges have a proven track record of working with JobCentres and employers to deliver sector-based work academies. We see this kind of support as central to helping revive opportunities and help people get back into sustainable employment.”