Latest news with #BarryFletcher
Yahoo
27-02-2025
- Business
- Yahoo
Youth unemployment surges ahead of Reeves's National Insurance raid
Youth unemployment has surged to its highest level in more than a decade amid warnings that Rachel Reeves's tax raid will worsen the crisis. Almost 1m 16 to 24-year-olds are neither employed, looking for a job nor studying, according new figures from the Office for National Statistics. There are 987,000 Neets – people not in education, employment or training – in this age group, the highest level since the end of 2013 when the economy was still recovering from the financial crisis. Worryingly, most are economically inactive, meaning they are not working nor seeking employment. That is in stark contrast to 2013, when most Neets were at least looking for a job but were unable to find one. Some 595,000 young people are classed as inactive, while 392,000 are unemployed but looking for work, an increase of more than a quarter over the year. Experts said the rise in inactivity was being fuelled by a mental health crisis among young people, many of whom are struggling with the after effects of pandemic lockdowns. The figures will alarm ministers, given the growing burden benefits payments are placing on public finances. Health and disability benefits for working-age adults cost the Exchequer almost £50bn last year, an annual bill which is forecast to rise to more than £75bn by the end of the decade. Barry Fletcher, the chief executive of Youth Futures Foundation, said he expected youth unemployment to rise further. He said: 'We have some challenges around hiring intentions from employers. Our worry is this problem is likely to get worse before it gets better, because we have got a general softening of the labour market.' The Chancellor's £25bn National Insurance raid comes into force in April, increasing the tax paid by employers on their workers' pay packets from 13.8pc to 15pc and reducing the earnings threshold at which it kicks in from £9,100 per year to £5,000. Minimum wage will also rise by 6.7pc in April. The changes disproportionately affect young and low-paid workers. Business groups have warned the changes will make employers less likely to hire young people and those looking for their first job. Mr Fletcher said: 'We are seeing vacancies drop – they are still higher than they have been in historical periods, but definitely dropping – and hiring intentions are dropping. Young people tend to get hit first by that.' Job vacancies have fallen by 100,000 since the Budget to 759,000 in January. Stephen Evans, the chief executive of Learning & Work Institute, blamed the pandemic for the rise in the number of Neets. He said: 'We've had the impact of the pandemic and lockdowns and disrupted education, so it seems likely we have got more young people disconnected from the jobs market altogether.' Mr Evans added: 'There has also been a growth in the number of young people saying they are too ill to work, with mental health conditions.' Jonathan Townsend, the chief executive of the King's Trust, a charity that helps disadvantaged youths, said the career prospects for those out of work would worsen the longer they were out of the jobs market. Mr Townsend said: 'Unemployment can have a profoundly negative impact on a young person's life and the longer they are unemployed, the harder it is to re-engage and get back into work. Around a third of unemployed young people are long-term unemployed and recently we have seen mental health being a key factor in this. 'Our youth index finds that almost one in three out of work young people have experienced a mental health issue due to being unemployed and that their mental health has even stopped them from attending interviews or applying for jobs.' Alison McGovern, the employment minister, said: 'I am determined that no one will be left on the scrapheap, regardless of where they live: that is my message to the almost 1m young people not in education, employment or training. 'Our Get Britain Working reforms will deliver genuine opportunity by transforming Jobcentres, ensuring every young person has the chance to earn or learn and joining up fragmented work, health and skills support. 'This is how we will unlock the potential of our future generations and make everyone better off.' Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
The Guardian
27-02-2025
- Business
- The Guardian
UK faces youth jobs crisis as number of ‘Neets' rises to almost 1m
Experts have warned that the UK is facing a youth jobs crisis after a rise in the number of young people not in education, employment or training (Neet) to almost 1 million, the highest level in more than a decade. Figures from the Office for National Statistics show there were an estimated 987,000 young people aged 16 to 24 who were Neet in October to December last year, up from 877,000 in the fourth quarter of 2023 – the highest level since 2013. Highlighting a stark rise in young people falling out of the jobs market since the height of the Covid pandemic, the number of Neets has soared by more than a quarter of a million in the past three years. The figures mean one in eight young people across the country are now out of employment, education or training, at a time when Britain's jobs market is cooling as employers grapple with planned tax increases from the government, elevated borrowing costs and sluggish economic growth. The ONS cautioned there were issues with the quality of its labour force survey, meaning the data should be treated with caution. However, experts said there had been a clear rise in Neets in recent years. Barry Fletcher, the chief executive of the Youth Futures Foundation, said the figures showed the UK was facing a jobs 'crisis' for young people. 'If we are to prevent long-term scarring effects for young people and achieve the economic growth needed in our country, then we need sustained focus on the issue.' The government has grown increasingly alarmed by the breakdown in the critical years between school and work, amid warnings that failure to tackle the issue could hinder the economy and cause lasting damage for a whole generation of young people. Labour announced plans late last year for a 'youth guarantee' to ensure every young person has access to education or training to help them find a job, including through a programme of 'youth trailblazer' schemes in eight English mayoral authorities, which is due to launch this spring. Experts say the rise in the number of Neets comes after years of underfunding for employment support, alongside the impact from Covid lockdowns and a sharp rise in youth mental ill health. Ben Harrison, the director of the Work Foundation at Lancaster University, said large numbers of young people were actively looking for work but struggling to find it, with 392,000 unemployed – of which 64% are young men. He said almost half of Neets risked missing out on the government's youth guarantee. 'The government should consider expanding these initiatives,' he said. Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion Business leaders have warned that youth hiring will be hit particularly hard by the government's £25bn rise in employer national insurance contributions (Nics) and increase in the national living wage, both coming in from April, alongside a package of workers' rights reforms going through parliament. However, Paul Nowak, the general secretary of the TUC, argued that the 'Tory legacy' of rising youth unemployment needed addressing with more state support, rather than low pay and deregulation. 'The youth guarantee is the right step,' he said. 'But it must be part of a comprehensive plan to ensure all young people across the country can access high-quality training and decent, well-paid work as well as timely and effective healthcare.'
