Youth is losing the generation game

Youths Image copyright AP
Image caption The number of young people not in education, training or work has risen

The passing of the one million mark in youth unemployment looks like something of a tipping point.

The story of unemployment through the downturn so far is of how it's failed to reach expectations, helped that way by employers hoarding labour, looking after valued skills, and waiting for the upturn.

But a million young people looking for work (even if more than a third of them are full-time students looking for part-time work) is the kind of threshold that gets noticed by the public and voters.

Aware it was coming, both the Scottish and the UK government have been preparing a response to demonstrate they're on the case.

On Thursday, Scottish Finance Secretary John Swinney was promising to ensure there's closer work with major employers to address the problem.

Austerity drive

Friday brings Nick Clegg's response on behalf of the UK government - accompanied by rather more firepower. It has a £1bn bill attached, spread over three years from next April.

What remains to be told is where this money is coming from. You'd hope to find out in the autumn statement next Tuesday from George Osborne, when he reflects on the damage to his spending plans wreaked by the harsh downturn in expectations since he delivered his Budget in spring.

Could this billion pounds be a relaxing of the Osborne austerity drive, acknowledging that it's proving more difficult to stimulate private sector growth than the Chancellor had previously assumed?

If so, how to send that signal of flexibility in response to hardship while retaining a reputation in the bond markets for cold-blooded fiscal conservatism. If not, somewhere else is going to feel the pain when there's already quite a bit of that around.

Engaged employers

By happy coincidence, a thoughtful contribution on youth employment - and the lack of it - comes from an unofficial advisory panel set up under Lord Smith of Kelvin by the SNP government's predecessors and still at work on some pressing issues of the day.

The chairman of SSE, Weir Group and the Glasgow Commonwealth Games, with a panel drawn from business, the public sector and education, has taken the side of employers frustrated at the poor quality of their engagement from a public sector that doesn't appear to understand their needs.

His panel, including the chief executive of Cosla, is asking that a national forum be created to get round the fractured framework of trying to work with 32 councils. John Swinney seems to like the sound of that, and he'll also be happy to sign up to the call for training for work to be devolved to Holyrood from the Department of Work and Pensions in Whitehall.

He may also be interested in the heavy hint that Scottish government procurement policy could attach a requirement of a youth employment commitment into contracts being tendered.

The Smith report treads carefully round the question of the SNP government's spending priorities. But you can see where they're going with their stress on early years intervention for those most likely to be alienated by conventional schooling's offer.

If, as is argued, resource is needed for pre-school, and again to tackle the long-running problem of the primary-secondary transition, then it's going to have to come from somewhere else that's a lower priority. Universities, for instance? There's a curiously-worded warning that public policy makers need to keep under review the effect of student fees in England and Wales.

Milkround monitors

This is not the first report to raise these issues. But it's got particularly interesting observations on two aspects of the changing labour market that are affecting younger people.

One is that the cost of university is one of the factors driving young people of talent to by-pass it and head straight into quality apprenticeships. KPMG and GlaxoSmithKline are two companies to be looking beyond the usual recruitment rounds of graduates, to reach into schools for the best potential.

"Employers will increasingly develop an increase in identifying talent at an earlier age than the university milkround," says the report.

"They will seek new ways to spot talent within the schools system.

"This should be viewed as a great opportunity."

Ageism vs Youthism?

Less of an opportunity, and highlighted by Lord Smith's panel, is the impact of anti-ageism legislation.

It was clear early in the downturn that laws against age discrimination since the early 1990s recession were having an impact on protecting those in work, who had been shed most enthusiastically in past downturns. That trend, allied to pension disappointments, is only likely to be clearer through the recent reforms to end automatic retirement ages.

The knock-on effect is for those yet to be recruited into the workplace.

And young people are not the ones who benefit from the policy aspiration of 'no compulsory redundancies'. On the contrary, the not-yet-recruited are the ones who suffer when the existing workforce is protected.

It's one of the more important elements of an underlying tension within this economic downturn - the one between the generations.