Why teenagers will be casualties of recession

13th March 2009 at 00:00

With the second reading of the Apprenticeships, Skills, Children and Learning Bill complete, MPs should recognise that 16- and 17-year-olds facing unemployment are the forgotten group of this recession. They have been lost in the debate over the increase - to 850,000 - in 16- to 24- year-olds not in employment, education or training (Neet), and in the responses to rising unemployment: providing 35,000 extra apprenticeship places and Pounds 500 million for recruitment and training subsidies.

The key group are the 16-17s. At the end of 2007, the rate of unemployment among them was 4 per cent (about 53,000), below average for the unemployed as a whole. But it is likely to soar. Labour economists predict young people, who tend to be fired first, will bear the brunt of the recession.

Before the downturn, the level of employer-based apprenticeships for 16- 17s was stagnant. Even if employers could be persuaded that all the extra positions should be just for teenagers, only 8 per cent of them would be in apprenticeships, compared with 5 per cent today.

Significant job losses among the 140,000 teenagers in non-apprenticeship posts could more than offset such an expansion.

Neet numbers could rise for another reason. About half of 16-17s in full- time education work part time. If they lose these jobs and face financial hardship, they could drop out. And where parents lose their jobs and cannot support their children in post-16 education and training, and with jobs in short supply, they could add to the figures.

Early in the year, there was speculation that the Government would raise the education and training participation age to 18 from this September, rather than raise it to 17 in 2013, and to 18 in 2015. Such a move implies that an extra 190,000 young people would have to participate in education and training. Even to raise the age to 17 implies an extra 65,000 16-year- olds in education and training.

However, this cannot eradicate youth unemployment. Those unable to find a job could still choose unemployment rather than a spell of full-time education. By raising the participation age, they would be labelled as truants who were unemployed rather than Neet.

Increasing the participation age this September is obviously linked to Labour's legacy. Labour may not win the next general election and Opposition support is at best lukewarm, at worst hostile.

Yet such a move would be too much, too soon. Rather than raise the participation age this September, the Chancellor should announce in April's budget a jobs and skills plan specifically for 16-17s. A report by the CfBT Education Trust - Raising the Participation Age: Keeping it on Track - says such a plan is vital to help unemployed 16-17s today, but also to leave an opportunity, after the general election, for a government positively disposed to the idea to raise the participation age to 17 in 2013.

Key to the plan should be a skills initiative providing programme-led, work-based learning, supplementing any demand for employer-based apprenticeships for 16-17s. Also, the value of education maintenance allowances should be raised from Pounds 30 a week so that 16-17s in full-time education losing part-time jobs do not drop out. And a premium EMA rate should be paid at 17 to encourage 16-year-olds at FE colleges to stay on after gaining a vocational level 2 qualification and progress to level 3, or enter the new youth skills programme, in readiness for the upturn.

Mark Corney, Director of MC-Consultancy.

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