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CIPD calls for work placement subsidy

Employer survey highlights crisis facing youth employability:
CIPD calls for work placement subsidy for unemployed 16-17 year olds

The uphill struggle facing this years crop of GCSE school-leavers is looking ever steeper, according to the results of the latest quarterly CIPD/KPMG Labour Market Outlook (LMO) survey of more than 900 employers. It shows that 16 to 18 year-olds are currently less likely to be hired than the long-term unemployed, with a quarter of employers (24%) planning to hire from this age group during the current quarter. In contrast, almost two-thirds of employers (63%) are hiring from the 19-24 age category, with a similar proportion of employers planning to recruit older workers.

The results are consistent with the official figures from the Labour Force Survey, which show that 16-17 year-olds are suffering most of all in the jobs market. The number of 16-17 year-olds in employment has fallen by 18% during the past year which compares with a 5% fall for 18-24 year olds, a 2% fall for 25-34 year-olds and a 2% increase for workers above pensionable age.

More than 200,000 16-17 year olds 1 in 3 are now unemployed and actively seeking work. Most alarmingly, the number of 16-17 year olds who have been unemployed for more than a year has increased by almost 100%, to over 20,000 during the past year.

Gerwyn Davies, CIPD Public Policy Adviser, believes that a six-month work placement subsidy of 1,250 per person could offer vital help for 30% of 16-17 year olds who have been unemployed for more than six months: School-leavers seeking work this year face a difficult enough task finding an employer willing to take on young people, let alone find a job. These results suggest that government policy needs to be changed to give similar help to unemployed 16-17 year-olds as that which is given to other targeted unemployed groups. The September guarantee of a training or education place for young people is welcome but is unlikely to offer a full solution to the emerging youth unemployment and NEET crisis.

Ideally, all 16-17 year-olds should be in education or quality work-related training, such as an apprenticeship. But we are at present in far from ideal circumstances in the youth labour market. The work placement idea would give young people key employability skills even if a formal apprenticeship place is not available. Apprenticeships are often seen as the silver bullet, but our members feedback suggests that many employers are not in a position yet to offer apprenticeships. Whats more, many young people are put off by internships given their association with graduate schemes.

The work placement subsidy would therefore be a useful addition to the armoury of measures targeted as mounting youth joblessness and go some way towards helping pressured companies do their bit for what is becoming a national crisis.

The CIPD/KPMG Labour Market Outlook report also highlights the main barriers to recruiting young people: top of the list is a lack of experience (72%), followed by the availability of more suitable candidates (65%). The research also found that twice as many public sector organisations (35%) will be recruiting 16-18 year olds than private sector organisations (18%). Only fifteen per cent of organisations are taking on apprentices, while eight per cent of organisations are currently hiring interns. Again, public sector organisations are twice as likely as private sector firms to hire apprentices and interns.


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