This week’s ONS labour market data shows unemployment’s rising again. A slight increase to 3.9% in the last quarter (the number of people working also fell) but enough to suggest that the labour market’s cooling.- if not reaching full capacity (pay has continued to grow in real terms).
Youth unemployment grew more significantly. Up to 11.2% (from 10.7% last quarter) for the 16-24 age group, but this includes significant numbers of students looking for work. For a more reliable figure, we need to examine those in 18-24 age group ‘not in full-time education’. This has seen an increase from 9.1% to 10.7% in the last year.
Because many young people work near the margins of the labour market, with more of them in ‘precarious’ types of employment’ than any other group, increases in youth unemployment are also considered an indication of more general future trends in the labour market and economy.
But these days, it’s the prolonged stays in education by large numbers, not a prosperous economy, which results in youth unemployment remaining relatively low. On the contrary, most of the ‘youth jobs’ of the twentieth century have disappeared. Thus, according to ONS nearly two-thirds of the UK’s 3 million students report themselves as ‘economically inactive’ and therefore not counted as looking for work.
At another level, young people under 18 are now required to remain in education unless they enter some form of apprenticeship training, but the data shows that amongst 16-17 year olds who have left education ( about 1 in 7 ) a quarter are unemployed with nearly twice that number ‘economically inactive’. So much for raising the ‘participation rate’.