Tag: youth unemployment

Youth unemployment could reach over 100,000 in Scotland this year

  • Over one in three of Scotland’s young workforce could be unemployed later this year – the highest ever level since records began
  • Urgent action needed over the coming weeks and months to meet the ‘100,000 challenge’ to provide 100,000 new opportunities for young people through learning or working.

IPPR Scotland has published new research which shows the scale of the youth unemployment challenge Scotland could face later this year.

In the think tank’s ‘central scenario’, based on forecasts from the UK Office of Budget Responsibility, youth unemployment in Scotland could surge past 100,000 young people later this year as the furlough schemes end and the UK as a whole enters a jobs crisis. This would see over one in three of Scotland’s young workforce (16-24 year olds looking for work) facing youth unemployment – the highest level since records began.

The think tank warns that youth unemployment could be worse than this in a reasonable worst-case ‘downside’ scenario, with over 140,000 young people unemployed by the end of 2020. In the ‘upside’ scenario, youth unemployment increases hugely, but stays around 80,000 and beneath the level seen following the 2008/09 financial crash. 

The ‘scarring effects’ of unemployment early in someone’s career are well-documented, with people who experience youth unemployment for a significant time facing a pay gap that many never close throughout the rest of their working lives. This could have significant implications for health and wellbeing and cause significant long-term damage to Scotland’s economy.

To protect a generation of young people, IPPR Scotland is calling for urgent action over the coming weeks to meet what it’s calling the ‘100,000 challenge’ – providing 100,000 new opportunities in Scotland across education, skills and employment.

This will need urgent action from government, colleges and universities, and employers in Scotland. The think tank is also calling on the UK Government to maintain support for jobs across the economy by replacing the furlough scheme with a ‘short-time work scheme’, as seen in France and Germany, that would see employers able to offer subsidised part-time work rather than being forced into laying people off.

The UK Government has announced a Kickstarter Job Scheme that is due to begin in the autumn, however details so far are lacking. Further details on the Scottish Government’s own £60m Scottish Youth Guarantee are also awaited. The think tank fears neither scheme is likely to reach the scale required as things stand.

Russell Gunson, Director of IPPR Scotland, said: “If these projections turn out to be true we will see youth unemployment on a scale we’ve never seen before in Scotland later this year.

“Over 100,000 young people – or more than one in three of Scotland’s young workforce – could be unemployed by the end of the year. This is unprecedented, and will need unprecedented action over the coming weeks and months without delay.

“While both the UK and Scottish governments have announced action to try to stave off youth unemployment, we have not yet seen the scale of action meet the scale of the challenge.

“As the school year starts and as we approach the new academic year for college and universities, we need to act now to help those without a place in education or training and without a job. That will need action from across Scotland – including government but also from businesses, employers, colleges and universities.

“We are facing a ‘100,000 challenge’ in Scotland. The question we must ask and urgently answer is: how do we create 100,000 new opportunities for young people in Scotland over the rest of this year?

“Through further additional college and university places, through even greater investment in learning and training, and through action by employers to try to protect opportunities for young people it is more than possible. But we must now act at a pace and a scale not yet seen.”

The Scottish Government continues to press UK Chancellor of the Exchequer Risho Sunak to extend the furlough scheme, which is due to end in October. It’s feared that, unless the scheme is extended, tens of thousands more workers will be made redundant.

Mixed views on latest employment figures

Unemployment in Scotland fell over the last three months, but opinion is divided on just how robust the economic recovery is looking in Scotland. The Scottish government has welcomed the latest figures, but trade union leaders believe that, with a continued rise in long-term unemployment, the lessons of past recessions have not been learnt.

According to official figures released today, unemployment in Scotland has fallen by 14,000 over the three month period from September to November 2012. The Office of National Statistics figures also show that the youth unemployment rate saw the largest annual drop since the time series began in 2006, and is now the lowest level since March to May 2011.

Youth unemployment has fallen by 23,000 over the year to September to November with the rate decreasing by 4.8 percentage points to 19.9 per cent. The UK rate decreased by 1.7 percentage points to 21.0 per cent. This is the largest annual decrease in the youth unemployment rate in Scotland since the data series began in 2006. The youth employment rate in Scotland is 55.1 per cent compared to the UK rate of 51.8 per cent.

Scotland’s headline employment rate (for those aged 16 to 64) fell by 0.6 percentage points over the three months from September to November to 70.6 per cent, but the headline employment level (for those aged 16 and over) increased by 1,000 over the year. Scotland continues to have the fifth highest employment rate of all 12 UK countries and regions.

The claimant count in Scotland decreased by 1,400 over the month of December 2012, the second consecutive monthly fall. Over the year, the number of people claiming Jobseekers allowance fell by 4,400 to 137,500.

Commenting on the latest figures, Finance Secretary John Swinney said: “These figures show that unemployment in Scotland has continued to fall for the second monthly release. The strong performance in youth unemployment over the year is particularly welcome. We have lower youth unemployment, higher youth employment and lower youth inactivity than the UK. What’s more, this month’s release sees the largest annual drop in the youth unemployment rate since the data series began in 2006.

“However, we must continue to work to boost employment and the Scottish Government is taking direct action by investing in our infrastructure and maintaining the most competitive business environment anywhere in the UK. Our budget includes a tax relief package for business worth over £540m this year and bring forward a further £385 million package of economic stimulus.

“We are also targeting growth markets and growth industries and our efforts are paying off with today’s Global Connections survey showing that Scottish exports increased by by £1.6 billion to £23.9 billion in 2011. With the full fiscal and economic powers of independence the Scottish Government could do even more to strengthen our economy and create jobs.”

Youth Employment Minister Angela Constance said: “Today’s figures show that youth unemployment in Scotland is at its lowest level since March to May 2011 after falling for the second monthly release in a row. Our actions to improve youth employment rates have included a guarantee of a place in education or training for every 16-19 year old through Opportunities for All, funding 25,000 Modern Apprenticeships in each year of the current parliament and £8.5 million to create 1,400 jobs in the third sector through Community Jobs Scotland.

“This year we will continue our efforts by launching an Employer Recruitment Incentive which will give financial support to small companies willing to give young people a job. This is backed by £15 million of Scottish Government funding and by £10 million European Structural funding. Our young people’s fresh and modern thinking in the workplace will help drive our economy forward and we will continue to work hard to ensure they have the opportunity to do that.”

However Scottish Trades Union Congress (STUC) General Secretary Grahame Smith said: “For the second month in a row, the reported fall in unemployment has been exceeded by the fall in employment and economic activity. Quite simply it is no cause for celebration if people are leaving the labour force altogether rather than looking actively for work.

“These statistics show a very weak labour market which continues to be characterised by significant falls in full-time permanent positions, rising underemployment and worrying increases in inactivity. The fall in youth unemployment over the year is encouraging although the rate has hardly shifted. The rise in very long-term unemployment across all ages confirms the STUC’s consistently expressed fears that the errors of past recessions are being repeated.”

The Scottish Greens are also warning the Scottish government against complacency. Green MSP Alison Johnstone, a member of Holyrood’s Economy committee, said: “The government’s efforts to date on training and apprenticeships are welcome but much more needs to be done to ensure young people and women in particular are not shut out of the jobs market. It is also a concern that we’re continuing to see part-time work replace full-time jobs, and that many people feel the need to take a second job to make ends meet.

“The evidence I’ve been hearing as the economy committee examines underemployment clearly shows this is a serious problem. I urge the Scottish Government to do more to help small and medium sized businesses expand so they can offer their staff more hours. I also want to see more done to provide good quality, affordable childcare, the lack of which forces many women to stay out of work. It’s also appalling that Scotland has the second most expensive childcare in Europe yet those providing it are often on very low wages.”

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Summit to address youth unemployment

Young people are discussing youth employment issues with senior Scottish Government Ministers today. Around 120 young people from a broad range of backgrounds are attending Scotland’s Youth Summit at the Hub on the Royal Mile.

The event – organised by Young Scot, the Scottish Youth Parliament and the Scottish Government – gives young people the chance to speak directly to Ministers, including Minister for Youth Employment Angela Constance, about ways in which 16-24 year olds can be supported into work.

Education Secretary Michael Russell, Culture Secretary Fiona Hyslop, Minister for Learning, Science and Scotland’s Languages Alasdair Allan, Minister for Children and Young People Aileen Campbell and Minister for Commonwealth Games and Sport, Shona Robison will also attend.

Ms Constance said: “Hearing the experiences of young people directly is vital to our work to support them and their peers into work. I have met many young people in training or education in the last year, as well as a number seeking an opportunity, but the Youth Summit will given dozens of 16-24 years the chance to tell Ministers about their experiences face to face.

“This government is doing more than any other to improve the employability of our young people. We are already committed to 25,000 Modern Apprenticeship opportunities in every year of this parliament and have guaranteed every 16-19 year old a place in education or training. The Employer Recruitment Incentive announced in the draft budget will also help small and medium-sized businesses to recruit unemployed young Scots. Today’s meeting will give key partners, including Ministers, a good sense of progress and ideas on how we can help further.”

Grant Costello MSYP, Chair of the Scottish Youth Parliament, said: “Young people have suffered enormously as a result of the economic downturn. It is crucial that action is taken to prevent a lost generation of young people who are unable to find work. I’m therefore delighted senior Government figures are coming to the Youth Employment Summit to hear from young people on their experiences and on the solutions which can make a difference to the thousands of young people who need a leg-up to get back on the ladder of work.”

Craig Shaw, Young Scot Digital Creative Modern Apprentice added: “When I left school, it look me a long time to find a job that I wanted to make into a career and I know the uncertainly of employment can be a daunting time for any young person. That’s why events such as the Youth Employment Summit are really important because it gives young people the chance to share their views with the Scottish Government and together with them, help design future employment opportunities for young people in Scotland.”