Despite the recent small fall in unemployment, there are still several very worrying indicators in the UK labour market: long-term unemployment is continuing to rise, the employment rate has continued to fall, and economic inactivity has hit a record high – with over eight million people now classed as economically inactive.
But perhaps most worrying of all is the level of youth unemployment, which has hit a record high and now stands at 927,000.
Today, one in five young people cannot find a job. This could have deeply damaging consequences. A sustained period of unemployment can have a disproportionate effect on somebody when it occurs at the beginning of their working life, preventing them from getting into the habit of working and denying them the social benefits of work that can go far beyond simply receiving an income.
Sadly, for some young people, unemployment represents the continuation of a pattern passed down through generations. The UK has the highest rate of children growing up in workless households in Europe, and children who grow up in workless households are more likely to go on to suffer from unemployment later in life.
Although the recession has exacerbated this problem, it did not create it. We went into the recession with almost five million people claiming some form of out-of-work benefits. Youth unemployment began rising in 2002 and already stood at 700,000 when the UK entered recession. So it is essential that more is done not just to offer support to young people currently unemployed, but to correct the failings in our welfare system.
That is why Conservatives have proposed radical welfare reform. The government has made some moves in this direction, but has not done enough. Their Young Person’s Guarantee, for example, was announced last April but has only just come into operation, almost two years after the recession started and unemployment began to rise.
Despite this initiative, many young people will still be waiting around ten months for specialist help. We believe young people need specialist help at an earlier stage and want them to have access to welfare-to-work providers – who have expertise in providing specialist help to get them into work – after six months’ unemployment. Unlike the Young Person’s Guarantee, which diverts young people away from welfare-to-work providers, we feel it is essential that this earlier intervention and increased support is an integrated part of the system.
But we also recognise that job opportunities are harder to come by as a result of the recession. So as part of our Youth Action for Work scheme we will provide extra training opportunities to supplement and complement welfare reform. Youth Action for Work will provide 400,000 opportunities for young people over two years, including through apprenticeships and training places.
I am determined to do more to ensure that people have the chance to work if they are able to do so. Our society and our economy cannot afford to lose out on the potential that is currently being wasted.
