Another half-witted Clegg copycat idea that’s all been done before and still doesn’t work?
Clegg's youth wage scheme 'won't address education failings', businesses warn
A new youth jobs scheme, which gives employers wage subsidies worth £2,275 to take on a young person, fails to address structural problems in England's education system, business experts have warned. (Many of today’s youths can’t do basic maths their heads, spell, read or use the correct grammar, and sit at home playing computer games or hang around street corners, some just staying in bed all day and don’t even go to school)
Under the new proposals to be outlined by half-wit Nick Clegg on Friday, some 160,000 18 to 24 year-olds will have half of their minimum wage paid by the taxpayer in a move to tackle the record number of young people not in education, employment or training (NEET). (When are there going to be proposals for helping the over 40’s get back to work, who would actually work?)
Employers will have to apply directly to Jobcentre Plus to get the new youth wage subsidy, worth half of the youth national minimum wage, under proposals to encourage business to hire more under-25s and curb growing youth unemployment.
The number of subsidies up for grabs, available from April 2012, is just a fraction of the total 1.02m young people out of work and will be reserved for those who need the most help on the Government's new Work Programme.
However, businesses that can prove they have a history of training and hiring young people will be given priority for the wage boost, a Cabinet Office spokesman said last night.
Provided employers meet certain criteria, the new subsidy will also be dished out on a "first-come, first-served basis", he said.
However, while employers backed the Government's desire to get young people working again, some were concerned the incentive scheme would "paper over" the cracks in England's education system.
Alexander Ehmann, head of regulatory affairs at the Institute of Directors, said: "We cannot doubt the sincerity of what the Government is trying to achieve here. But this doesn't address the structural issues around educational attainment. The Government should focus on the supply side [of education] ... otherwise we will just paper over the real issues."
He added there was a risk that employers would hire the hardest-to-help young people at the expense of other under-25s who were also out of work, meaning unemployment would unlikely fall as jobs were just "displaced" from one group of people to another.
Manufacturing and engineering companies said there needed to be greater emphasis on boosting skills in these areas throughout the schooling system, to address young people's "employability" rather than simply make them cheaper to employ.
Stephanie Fernandes of the Institution of Engineering and Technology said: "We would urge more action to increase apprenticeships in manufacturing and engineering. In the last figures released both these groups showed only a 25pc increase. Manufacturing and engineering offer real opportunities for substantial economic growth and we neglect these at our peril."
The Cabinet Office spokesman said the Government would promote the wage subsidy scheme to private sector industries with the most growth potential, rather than allowing a load of "non-jobs" to be created in the public sector. "We want to move away from the public sector and create more sustainable jobs," he said.
The proposal is part of a £1bn package of jobs incentives to be unveiled today to help combat rising youth unemployment. The Cabinet Office said the boost was "new money", not a reprofiling of existing funds.
New figures today show there are a record number of young people not in education, employment or training, less than a week after official unemployment figures revealed the number of under-25s without jobs has broken the 1m barrier.
However, the new proposals suggest that the Government will not be offering a holiday on National Insurance (NI) contributions for all young people in next week's Autumn Statement. The CBI had asked the Government to consider a £1,500 refund of NI contributions, paid to any employer hiring a young person, which would cover the first year of the tax.
A Government statement said: "Some employers have called for an 'NI holiday' and the CBI have called for a £1,500 subsidy. The Government is going further – providing half the National Minimum Wage – £2,275 – four times the value of an NI holiday."
The Government hopes employers will "rush" to get their hands on the wage subsidies to get Britain's young people working again.
The British Chambers of Commerce largely backed the move and said take-up should be closely watched. "If this is a roaring success, there will be an argument to extend the scheme to all young people," Abigail Morris of the BCC said.
Other measures to be announced today include an extension of the current work experience scheme, which guarantees unpaid work placements to 18 to 24 year-olds after three months' unemployment. Some 250,000 more places will become available by 2012, up from the current 100,000 – although this proposal relies on an increased desire from employers to offer the scheme.
All sectors of the economy will be "encouraged" to offer the scheme, the spokesman said, with a focus on manufacturing and growth sectors, like new technology and green energy, to try to kick-start growth.
Critics are likely to argue the work experience drive is just a form of "cheap labour", however, as the placements can last as long as eight weeks.
A new £50m training programme for "persistent" NEETS aged between 16 and 17 will also only pay training providers "by results" – once the young person has been in education or training for a set period of time – rather than upfront payments.
Those young people who drop out of work experience or a subsidised job will lose their benefits.
Separately, apprenticeship funding will be boosted, allowing for 20,000 more places – on top of the 400,000 places each year the Government hopes to create by the end of this parliament.
But similar to the work experience programme, employers have to show more interest in offering the on-the-job training scheme if targets will be met – currently, just one in eight employers runs apprenticeships.
Mr Clegg said: "If people are out of work when they’re young they bear the scars for decades. If they have a false start, they might not ever fully catch up.
“These are tomorrow’s mothers, fathers and taxpayers. If they end up falling behind our whole society pays the price.
“It hasn’t been easy to find £1bn but it is the right thing to do."