From education to employment

The missing link: NEET provision in the Spring Budget

Elizabeth Taylor & Jack Farnhill-Bain

In this article, Elizabeth Taylor and Jack Farnhill-Bain explore the missed opportunity to reach 485,000 able young people in the Spring Budget’s Back to Work proposals and debate how best to support NEET young people outside of the Jobcentre Plus ecosystem.

The Budget’s recognition of the role that economically inactive people could play in rebuilding the economy, and the measures set out to encourage greater numbers of them into work, makes sense.

Targeted support was announced for several groups, including disabled people and those with long-term health conditions, over 50s, low-earners and parents on Universal Credit.

Measures such as increasing the amount people on Universal Credit can claim in childcare, as well as paying those costs upfront; the scrapping of the Capability Assessment for those with disabilities; and pension changes to encourage older people to return to work, will all have their part to play.

The challenge is clear: there are more than a million vacancies in the economy and one-fifth of the working population is economically inactive – out of work and not looking for work.

But there is one sizable group of that economically inactive population that does not seem to have been catered for – young people.

Nearly 800,000 16–24-year-olds are NEET

According to the Office for National Statistics there are nearly 800,000 16–24-year-olds not in education, employment or training (NEET).

Data from the 2022 Labour Force Survey shows that 12.3 per cent of 16–24-year-olds are NEET, a rise of nearly two per cent from the previous year. In some areas, such as the North West, the NEET rate is as high as 17.2 per cent, up by 5.5 per cent from the previous year.

So not only is the national picture concerning, but there are also pockets of deprivation where the number of NEET young people is a serious problem.

NEET young people make up 12 per cent of the 6.5 million economically inactive people in the UK and a report by The Prince’s Trust and the Learning and Work Institute shows that 485,000 of these are both able and willing to work.

This is a significant number that could provide an important boost to the UK’s labour market and economy, given the right support.

The Budget includes an extension of funding for the Youth Offer, which provides specialist job coach support for young people who can be referred to Youth Hubs by Jobcentre Plus. However, it wasn’t one of the Budget’s headline measures and coverage is limited, with only 150 Youth Hubs nationwide.

Additionally, not every NEET young person is on Universal Credit and engaging with a Jobcentre.

The Budget also aims to strengthen the sanction regime within Universal Credit, promising that job search requirements will be applied more ‘rigorously’.

For young people on the fringes of society, who have fallen through the cracks of education, employment, or training, there is little evidence that sanctions will work, according to a report in The Guardian about an internal study by the Department for Work and Pensions.

The report states the study, commissioned in 2019, showed no evidence that benefit sanctions incentivised people to get work, but could have a negative effect on claimants’ health and finances.

Considering that one in five NEET young people reports having a mental health condition, it is questionable whether the Jobcentre Plus ecosystem is the correct way to encourage this group of young people to enter the labour market.

Expand the Youth Offer programme

We believe there should be an expansion the Youth Offer programme and that the Government should be looking outside the Jobcentre network to specialists who have the knowledge and connections to deal with the NEET problem.

The employment support sector, represented by ERSA, knows there are many experienced and effective organisations working on youth provision. Some of their work aligns with Jobcentre Plus through national programmes such as the Restart Scheme and the Work and Health programme, but also with very localised provision.

Employment support providers have a proven track record of community-based engagement with young people, as well as employers, and education and training providers in their communities.

Two examples among ERSA members are The Prince’s Trust, which has helped over one million young people, with three in four entering some form of education, employment, or training, and the Paddington Development Trust, which supports NEET young people to find work in their community and has the necessary knowledge to do so.

Of course, encouraging back into work those who have recently left it and who have the skills the country needs, is an obvious short-term solution and a key theme of the Budget.

It shouldn’t be at the expense of those young people

But it shouldn’t be at the expense of those young people who could give an undeniable boost to the UK labour market and help to combat the economic challenges of inflation, low growth and national debt.

We know the employment support sector has answers to labour market shortages and economic inactivity. We understand the differences between those who are voluntarily and involuntarily not seeking work and recognise that employment support needs to be tailored to the individual.

While we welcome the drive to remove barriers to employment for some economically inactive groups, we urge recognition that young people should be regarded equally as beneficiaries of the sort of measures included in the Budget. And we would recommend initiatives highlighting the benefits of work are delivered in schools or else the current dilemma could be with us for generations to come.

By Elizabeth Taylor and Jack Farnhill-Bain, Employment Related Services Association (ERSA)

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