Faced with the threat of a huge rise in youth unemployment in the final quarter of 2020, Chancellor Sunak set up Kickstart. Providing £2billion funding to create sixth month job placements for 16- to 24-year-olds on Universal Credit who are at risk of long-term unemployment, Employers of all sizes were encouraged to apply for funding which covered minimum wage payments and NI contributions. Youth unemployment has not yet reached levels feared, but this is as much to do with the extension of and the extensive use of the furlough in sectors like retail and hospitality – even so, young people have made up almost 60 % of all redundancies during the pandemic.
Four months after the scheme opened to applications the BBC reported less than 2,000 young people have actually started placements. This was, it reported, partly because lockdown has forced some employers to put placements on hold, but also because hundreds of applications had been held up by processing difficulties.
But rather than backing Kickstart, more campaigning organisations, including Gordon Brown’s Alliance for Full Employment are now calling for a job guarantee programme instead, where young people are given proper contracts, paid above the statutory living wage, where all placements include real training opportunities rather than optional ones and where the programme would be open to all those not attending higher education, not just restricted to those on universal credit.
Kickstart falls well short of New Labour’s Future Jobs Fund (FJF) which, in the context of the financial crash argued, that if jobs were not available then they would need to be created. FJFs proponents claimed that, after projected tax revenues were factored in, the initiative would also pay for itself –but more importantly, prevent the long term social and psychological ‘scarring’ effects of a prolonged period of idleness on a young person.
FJF, though still limited in scope, did have some success. Unlike in Sunak’s programme, public sector and voluntary organisations played a major role — relying on private sector employers, who’s first priority is to protect existing employees against an economic downturn, to create placements is not going to be sufficient and certainly cannot be relied upon to create ‘good’ jobs. (The FJF also stipulated, or at least aimed to ensure that the new jobs should be ‘socially useful’ -even better, at least a proportion of them should be ‘green.’)
Of crucial importance in the success of a new scheme would be the involvement of Local Authorities, for example in introducing quotas for the employment of young people, as a condition of council contracts, purchasing agreements, planning permission and grants. LAs could also oversee local employment networks, where employer vacancies could be matched to young people’s needs and where to borrow language from the financial sector the LA would act as a ‘provider of last resort’ for those young people still without employment, working with other public and voluntary sector providers to ensure that the meeting of apprenticeship standards would lead to permanent jobs.
But a job guarantee programme for young people, indeed any job guarantee programme for that matter, can only work as part of a wider social and economic reconstruction – for example, part of the Green New Deal combined with a plan to upgrade and ‘professionalise’ the health and social care system. We cannot just train young people in ‘new’ skills and then just hope for the best.
Rebuilding this way would allow the creation of permanent employment for young people, rather than just ‘ placements.’ It would, for example, require a major reorganisation of the building and construction industry, a sector because of its reliance on casualised and overseas labour and the predominance of small firms, has not been conducive to taking on younger workers.
Organised differently, with a rewriting of apprenticeship standards around the requirements of green jobs, a recent Friends of the Earth report argues that spending £10 billion could create 250.000 green apprenticeships over the next 5 years, and more than covers the knock-on effects of increased youth unemployment –if all young people currently without a job remain unemployed for a year, it could result in £39bn in missed wages and therefore lost spending, in the UK over the next two decades.