Labour is risking a ‘lost generation’ of jobless youth: Landmark report by party grandee warns ONE in SIX young people will be on the dole by 2030 without a major welfare reform
Labor must deliver welfare reform or condemn a ‘lost generation’ of young people to a life of poverty, the party will be warned today.
Former Labor Cabinet Secretary Alan Milburn is set to sound the alarm on youth unemployment, saying one in six young people will be on unemployment benefits by the end of the decade unless urgent action is taken.
In a thought-provoking assessment in its long-awaited report, it says the number of so-called Neets without education, employment or training will increase by a quarter to 1.25 million.
The youth employment crisis in Britain is already worse than that in countries such as Greece, France and Spain. Mr Milburn will warn that sweeping reforms to Britain’s welfare, education and health systems are needed to prevent the crisis from worsening further.
And the former health secretary will tell ministers that the practice of introducing piecemeal plans on top of a ‘broken system’ is doomed to failure.
But he will not hold back from calling on the Government to roll back measures he says have made it harder for employers to hire young people, such as a new workers’ rights charter and huge increases in the minimum wage.
And it won’t publish detailed reform proposals until the autumn.
Today’s report says the welfare state, once built to provide a safety net, is now ‘exacerbating inactivity’.
Former Labor Cabinet Secretary Alan Milburn is set to sound the alarm on youth unemployment, saying one in six young people will be on unemployment benefits by the end of this decade unless urgent action is taken.
Mr Milburn will refrain from calling on Sir Keir Starmer to roll back measures he says have made it harder for employers to hire young people, such as a new workers’ rights charter and big increases in the minimum wage.
Britain’s youth employment crisis is already worse than countries like Greece, France and Spain
He warns that the increase in diagnoses of mental health problems such as anxiety, depression and autism is leaving many young people out of the working world, while the decrease in the number of people starting work makes it difficult to step onto this ladder.
Mr Milburn will say increasing numbers of Neets are at risk of being ‘permanently’ cut off from the labor market. ‘Six out of ten people have never had a job. “Twenty years ago, this figure was close to four in ten,” he will say.
‘Separation is no longer temporary. For many young people, this situation becomes permanent. We face the risk of a lost generation.’
The Conservatives warned last night that Labor policies such as the £25bn boost to National Insurance were fueling the crisis by making it more expensive to employ young people.
Employers are said to have ‘repeatedly’ warned Mr Milburn that huge increases in the minimum wage for young workers were destroying jobs.
Shadow work and pensions minister Helen Whately said: ‘Every policy choice Labor has made, whether it’s a jobs tax, capping apprenticeship funding or trapping young people on welfare, has made it harder for a young person to get their first step into work. Their only response was a flurry of piecemeal work schedules; ‘An approach that makes this report rubbish.’
He added: ‘Starmer and his rivals in the leadership are too busy playing politics to tackle this generational crisis.’
Ryan Wain, senior director of policy and policy at the Tony Blair Institute, said: ‘Milburn is spot on. The economic crisis has become a moral crisis, with nearly a million young people cast aside; The purpose, hope and desire that work provides you are denied.
‘Wholesale, comprehensive reform is required. Make it cheaper and easier for businesses to give young people a chance. Ensure the next generation develops the skills and confidence to thrive. Give them a link to the job.
Students studying at vocational high school. In a thought-provoking assessment in its long-awaited report, it says the number of so-called Neets, meaning those not in education, employment or training, will increase by a quarter to 1.25 million.
Marks & Spencer boss Stuart Machin (pictured) described the report’s findings as ‘shocking but not surprising’
‘It will take time to do this properly but rising welfare spending now needs to be checked. ‘Put the immediate brake on social assistance by providing in-kind support rather than cash payments for conditions that do not limit a young person’s ability to work.’
The survey for Mr Milburn’s report found that 84 per cent of those classed as Neets wanted jobs or training. But the research found a sharp decline in the number of new jobs starting.
Vacancies in the hospitality sector have halved in the last four years, while the number of Saturday jobs has been found to be in ‘freefall’. The number of young people starting apprenticeships has fallen by 35 percent in the last decade.
Mr Milburn will say: ‘The first rung of the career ladder has become thinner. For many young people, this is now out of reach.
‘This places them in a desperate Clause 22 situation where employers want work experience but young people’s opportunities to gain this experience are narrowed or absent.’
Marks & Spencer boss Stuart Machin said: ‘The findings are shocking but not surprising; I hear these every day from colleagues and clients who worry that opportunities and role models are disappearing.
‘A Saturday job in retail changed my life, boosting my confidence and giving me the skills to build a fulfilling career. ‘We have the chance to offer every young person a similar path.’
The report harshly criticizes the welfare system. The report found the crisis was driven by a rapid increase in the number of young people contracting mental health issues that meant they no longer had to look for work.
Mr Milburn rejected the idea of a ‘generation of snowflakes’. But he will say the welfare system needs to do more to encourage and support young people into work rather than denying them benefits.
He will point to figures showing that for every £1 spent on employment support for under-25s, around £25 is spent on benefits.
‘This is not the failure of young people,’ he will say. ‘This is the failure of a system stuck in the past. Whether it’s education, health or welfare, this system is failing to enable them to participate in the labor market.’
