On the map - Youth unemployment - No certainty that end of EMA will cause rise in joblessness

24th June 2011 at 01:00

Will the end of the education maintenance allowance (EMA) make youth unemployment better or worse? Logically, the answer must be worse, as we can presume that some of those who would have received an EMA will instead look for work. However, a paper presented at a recent conference by John Philpott, the chief economic adviser at the Chartered Institute of Personnel and Development, might lead us to think again.

One of the success stories of the past two decades has been the growth in numbers staying on in education after the age of 16. The number of economically inactive 16 to 24-year-olds - that includes those in education, as well as young mothers and those in custody - has increased from 1.8 million in 1992 to 2.6 million in 2010, an increase from 25 per cent of the age group to nearly 36 per cent. Incidentally, this has also created many new jobs in education for teachers and lecturers.

Over the same period, the proportion of 16 to 24-year-olds in employment dropped from 63 per cent to 51 per cent of the age group. Twelve per cent of the group were unemployed in 1992 and 13.1 per cent in 2010.

While every case of youth unemployment is a potential personal tragedy, youth unemployment tends to be higher than adult unemployment, as young people change jobs more frequently than adults in an attempt to find their niche in the workplace.

Suppose every student who would have received an EMA decides instead to look for work in 2011 rather than bear the full cost of studying. Only if greater numbers remained unemployed than among the age group as a whole would the unemployment rate rise.

This is not to advocate either the ending of EMAs or agree that education is a "bad thing", but to recognise that present measures of calculating youth unemployment, as John Philpott pointed out, may not measure changes over time as we think they do. Present youth unemployment, although high, is nowhere near the levels seen in the early 1980s, when the number of 16 to 24-year-olds claiming benefit topped the million mark, compared with under 400,000 today. Transferring EMA cash into apprenticeships should also help to reduce the youth unemployment rate. Talk of a "lost generation" may be over-dramatic.

John Howson is director of Data for Education, an independent research analysis company


1992 - 12% : 25% : 63%

2008 - 9.3% : 32.5% : 58.2%

2010 - 13.1% : 35.7% : 51.2%.

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