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This morning the Guardian reported ‘Number of young people in UK not in work or education falls below 1 million’. Technically yes. The ONS released new statistics today which show that the number of people aged 16 to 24 not in employment, education or training (NEET) is down 30,000.
Unfortunately, it is not cause for celebration yet. The change itself means very little. The ONS itself says that short-term variations should be treated with caution in favour of observing longer-term patterns. Those are not comforting at all.
Programmes that are aimed at young people who want to work fail to address the dwindling opportunities available in the job market
A more telling statistic from the same release is that the four-quarter trend is up. The four-quarter average was 712,455 in the first quarter of 2022. It now stands at 973,144. That is a rise of 260,689 across 17 quarters, and it went up in 14 of them.
Against 2019, the four-quarter average is higher by 185,161, and the rate has gone from 11.27% to 12.98%. Some of that is simply that there are more young people. But there is still a substantial increase nonetheless. At the 2019 rate, today’s cohort would produce 849,567 NEETs. It produces 980,690.
When you look at seven years of data rather than just one quarter, something else becomes visible. Of the 185,161 increase, 114,141 are economically inactive. So there are now more young people not looking for work at all. Unemployment accounts for the other 71,020 of the rise.
So the thing that has grown since 2019 is inactivity among young people, overwhelmingly in their twenties.
This is what makes it difficult for the Government and those who aim to solve the NEETs crisis. Every policy announced this year by the Government and opposition parties focuses on those who are looking for work. The Jobs Guarantee, whose first placements began this week, offers six months of employment to 18- to 24-year-olds who have claimed Universal Credit for 18 months and are searching for a job. Reform’s apprenticeship wage credit would pay employers 30% of an apprentice’s wage. The Tories would relax the working time rules for under-18s.
So the focus goes to young people who are looking for work, despite the rise in NEETs largely being those who are not. Meanwhile the money also goes to those who are not working. The IFS costed the Government’s employment package at about a third of a billion a year. The Resolution Foundation estimates that 210,000 young people are on incapacity benefits, 84% of them under no requirement to do anything at all. At £9,220 a year in standard allowance and the health element, that group alone costs roughly £1.6 billion a year. That is five times what the employment package costs annually, and none of it conditional on anything.
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Those programmes that are aimed at young people who want to work fail to address the dwindling opportunities available in the job market. Vacancies stood at 707,000 in May to July. The lowest outside the pandemic since 2014. You can train a young person and subsidise a young person. But if in the end there is no job to apply to, you have not helped.
We cannot train our way out of the crisis. The lowest NEET count in the whole series, 674,574, came in the spring of 2021, when firms were hiring anyone they could get. No government programme produced that. A growing economy did.
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