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5 February 2021updated 09 Sep 2021 11:44am

How Covid-19 has sparked a youth unemployment crisis

More 16-24 year-olds have dropped out of the UK workforce than any other age group, but the government's flagship employment scheme continues to fall short.

By Freddie Hayward, Harry Clarke-Ezzidio and Michael Goodier

A generation of young people’s career prospects are being stifled as the coronavirus pandemic continues to devastate the job market. Figures from the Office for National Statistics (ONS) show that more 16-24 year-olds have dropped out of the UK workforce than any other age group.

 

The latest statistics show that from September to November 2020, there were over 200,000 fewer 16-24 year-olds in employment than a year earlier. While this is a slight improvement from earlier in the pandemic, it still leaves a bleak picture for this cohort.

And the situation will get worse. In addition to 16-24 year-olds suffering the highest redundancy rate among all age groups between March and October 2020, many more could lose their jobs when the furlough scheme ends, as it is scheduled to at the end of April. Those on furlough tend to be younger – according to figures from HMRC – meaning there may be a second wave of youth unemployment if furlough does not continue. 

 

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The latest ONS figures also reveal that the current cohort of graduates has fewer jobs to apply for in comparison to last year, as the pandemic has shrunk the jobs market for university leavers.

This has left many young people from across the socio-economic spectrum in an increasingly precarious situation. For 19-year-old Billy Hines, being able to work for at least 16 hours a week across factories and warehouses gave him stability and a steady income. “I was loving it,” he says. “There’s a bit of routine, I was getting up at 6:30. It was keeping me fit, it was keeping me focused.”

 

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Billy found his job through a temporary employment agency. But during the first lockdown work dried up, and he’s since had to borrow from his mum and his girlfriend, who is working as a cleaner.

“It’s not nice [asking for money],” he says. “I know they don’t mind, because they see the bigger picture. But you just feel like a leech.”

[see also: The dunce of Westminster: Martin Fletcher on Gavin Williamson]

He doesn’t like the fuss and bureaucratic box-ticking that characterise many government job schemes, along with training requirements he considers inane and demeaning considering the work he is experienced in. Nor does he want to rely on benefits – he thinks extra tax spending should go to the nurses and doctors on the front line of the pandemic. 

“I just want to earn my money, get by… I don’t want fancy cars, well I do,” he says, “but that goes to a certain type of person.”

Young people are justified in being anxious about their future prospects. Previous recessions have shown that the detrimental effects of being unemployed while young – including on happiness, health, and job satisfaction – can persist for years. It also carries a wage-penalty when individuals re-enter to the jobs market – an impact that can last a lifetime.

 

For Shannon, 22, an apprenticeship had helped her become a snowboard instructor and receptionist at an indoor ski centre. When the lockdown was announced in March she was put on furlough, but lost her job when the business was closed in August.  

“It was very difficult… I was very, very stressed and my head was everywhere,” she says. 

Since then, Shannon has started a fashion degree, and in the long term she plans on setting up a youth centre for young people to engage in creative activities. Currently, as an independent student she needs additional income in order to survive. “I’m still looking for a job but it’s difficult at this moment in time,” she says.  

In an attempt to tackle the surge of Covid-induced youth unemployment, Chancellor Rishi Sunak announced the £2bn Kickstart Scheme in September, aimed at encouraging businesses to create new jobs specifically for the young. 

Upon announcing the scheme, Sunak said: “Our country’s future will be built by the next generation, so it’s vital that we harness the talent of young people as we rebuild from the pandemic.

“But this isn’t just about kick-starting our economy, we’re giving opportunity and hope to thousands of young people, kick-starting their careers and offering them a brighter future.”

[see also: Why Rishi Sunak can’t escape blame for the Covid-19 crisis]

However, so far the reality of the scheme is yet to match the rhetoric. While the government recently announced that Kickstart has created over 120,000 temporary jobs, it was revealed that fewer than 2,000 young people have filled the vacant roles.

“Lockdown has prevented people from taking up these places,” says Kathleen Henehan, senior research and policy analyst at think tank the Resolution Foundation. “As restrictions start to loosen in the spring, the government will need to continue developing the scheme, alongside working with employers and job centres, to ensure the young get back to work swiftly.”

The Chancellor has paid lip service to the importance of this challenge both for young people and the country. But the slow start to the Kickstart scheme suggests not enough attention has focused on how to make it work in practice. And for those who have been struggling to find work since the first lockdown, every week out of work magnifies the impact.

“Young people have been hit hardest by Britain’s growing jobs crisis,” warns Henehan. “Keeping youth unemployment down is crucial to avoid lasting damage to careers that are just getting started.”

[see also: Katharine Birbalsingh on why schools need to reopen – now]

Freddie Hayward is a graduate trainee at New Statesman Media Group. Harry Clarke-Ezzidio is a graduate trainee at the New Statesman. Michael Goodier is a data journalist at New Statesman Media Group.