October 20, 2021
A new report highlights a combination of regional disparities in access to jobs for young people, a shrinking youth labour market and an unequal recovery. This could result in young people being ill-equipped to meet the future demands of the labour market, further compounding skills shortages currently faced by employers.
The findings come from A Better Future: Transforming jobs and skills for young people post-pandemic, research commissioned from the Institute for Employment Studies (IES) and the Institute for Public Policy Research (IPPR) on behalf of Youth Futures Foundation and the Blagrave Trust. The report warns of generational progress grinding to a halt in the UK, with the wage gap between older and younger workers widening since the 2008 financial crisis, and youth employment falling by a quarter of a million since the start of the pandemic.
The pandemic has also seen a large growth in student numbers, with youth participation in full-time education now at its highest rate on record (48 percent, compared with 43 percent before the crisis began) with 260 thousand more young people in education and not looking for work than pre crisis levels. These large falls in labour market participation are a key driver in the current difficulties that employers are having in filling entry-level jobs, especially where those roles are not being advertised flexibly (for example in ways that can fit around studies).
The research claims that young people are over-represented in sectors that are expected to see lower employment growth in the long term, and vital ‘stepping stone’ mid-skill jobs are declining, with more young people in insecure or part time work. However, the researchers identified that the shift to green jobs through government investment in its Levelling Up and Net Zero strategies could create an additional 130,000 jobs for young people, many in the shrinking, yet crucial, mid-skill job spectrum.
In all regions, youth employment under this trajectory grows by between 4-5 percent. This translates to, for example, approximately 19,000 jobs in the North West, 15,000 jobs in Yorkshire and the Humber, 14,000 jobs in the West and East Midlands respectively and 18,000 jobs in London. The occupational groups with the most growth are: (1) skilled trades, (2) caring, leisure and other service occupations and (3) professional occupations which together make up about 80 percent of job creation across regions.
“The pandemic has had a seismic impact on young people’s education and employment”
Opportunities for young people to transition from existing jobs to ‘green’ roles include workers from the construction sector trades such as home retrofitting and low-carbon heat, while receptionists and retail sales workers could move into customer service representative roles in green sectors to meet growing demand. But with unprecedented numbers of young people staying on in education and fewer jobs available for them each year, skills provision must be more closely matched with local labour market need, with local areas given more powers to design and shape local provision.
The report sets out eight key recommendations for government to future proof young people’s jobs and skills. These include:
• Government should aim to create new ‘green and clean’ job opportunities for young people through its ‘Levelling Up’ and ‘Net Zero Transition’ investments
• Government and its partners should use these investments to massively scale up apprenticeships and establish skills pipelines for disadvantaged young people
• Government should extend and reform Kickstart, with a new ‘Kickstart Plus’ creating opportunities for long-term unemployed and disadvantaged young people to get into work
• A meaningful ‘Opportunity Guarantee’ should be put in place to ensure that no young person reaches long-term unemployment
• Government should establish new local youth employment and skills boards as part of the new Levelling Up strategy
• Introduce a commitment to new trailblazers of ‘Universal Youth Support’ to test more extensive devolution and integration
• Introduce new labour market regulations to raise job quality by publishing the postponed Employment Bill
• Promote new forms of non-work income to bolster security for young people, for example through lifelong learning accounts or a Citizen’s Wealth Fund
Joy Williams, IES lead author, said: “The pandemic has had a seismic impact on young people’s education and employment, but it is important now to look beyond its immediate aftermath and grasp a once in a generation opportunity to address longstanding problems with the youth labour market, including persistent regional disparities, unequal outcomes and increased precariousness.”
Clare McNeil, IPPR lead author and Associate Director IPPR, said: “Young people today will only avoid the fate of poorer job prospects and lower lifetime earnings than previous generations, through ambitious job creation targets, reform of the youth employment and skills system and the promotion of forms of non-work income to bolster their security.”