Long-term youth unemployment up by 23 per cent while government support is cut by 26 per cent

date: 12 October 2012

embargo: 00.01hrs Monday 15 October 2012

Long-term youth unemployment in England has increased by 23 per cent since the government came to power in May 2010, according to TUC analysis published today (Monday).

The North West is the worst hit region with a 53 per cent increase (26,000 youngsters) in the number of 16-24 year-olds out of work for six months or longer, followed by the East of England (40 per cent) and Yorkshire and the Humber (29 per cent). London is the only area to have witnessed a small fall.

The TUC research also shows that as long-term unemployment has rocketed government support for unemployed young people has fallen by 26 per cent following the replacement of the previous government's Youth Guarantee (which included the Future Jobs Fund) with the new Youth Contract.

According to the TUC study, the government will spend £98m less this year on support for jobless young people claiming Job Seeker's Allowance (JSA) in England than was previously provided under the Youth Guarantee.

The North West, which has seen the biggest rise in long-term youth unemployment, has also witnessed the largest drop in funding - with nearly £16m cut from budgets.

The TUC is concerned that with the new funding levels under the Youth Contract dependent upon employers taking-up the government's job subsidy places, the cuts could be even sharper.

No statistics have yet been published on employer take-up levels but concerns have been raised by the manufacturers' organisation the EFF that many employers do not know about the new scheme.

The TUC said the findings - published in the week that thousands plan to walk through central London as part of A Future That Works march and rally -highlighted the impact that austerity measures are having upon young people and the inadequate levels of support being given to them.

The TUC believes that the funding cuts, combined with the axing of the Educational Maintenance Allowance (EMA), the hike in tuition fees and the proposed scrapping of housing benefit for under 25s, are making it much harder for young people to get on and find decent long-term work.

TUC General Secretary Brendan Barber said: 'With such sharp cuts in support for young unemployed people, it's no surprise that the government is failing to get to grips with this urgent problem. It is deeply concerning that many of the areas hit hardest by unemployment are seeing such a steep drop in financial support for jobless youngsters.

'Long-term youth unemployment is a ticking time bomb under the nation's finances, with severe consequences not just for young people but also for their communities and the country's wider economic prospects. This crisis simply cannot be tackled on the cheap. These cuts are a false economy - failing to act now will cost us all in the longer-term.

'Rather than rationing opportunities for young people, through scrapping the EMA, raising tuition fees and cutting housing benefit, the government should be making it easier for them to get on and fulfil their full potential. We need a future that works and that is why thousands of young people, their parents and their families will be marching in London this Saturday.'

NOTES TO EDITORS:

Long term youth unemployment and funding cuts per region

Source: Labour Force Survey, ONS

- £450 million a year was allocated to the Youth Guarantee (which was cut by the coalition Government in June 2010), www.hm-treasury.gov.uk/d/press_13_10.pdf, £1 billion of expenditure has been allocated to the Youth Contract over three years www.dwp.gov.uk/newsroom/press-releases/2011/nov-2011/dwp132-11.shtml. These cuts amount to a reduction in expenditure of £116m per year, or £270.58 less for each unemployed young person. Once Wales and Scotland are excluded (neither programme applied to Northern Ireland), the cut equates to £97.9m per year across England.

- Recent research from the manufacturers' organisation EEF suggests that awareness of the Youth Contract is low www.eef.org.uk/releases/uk/2011/Youth-contract-fails-to-hit-mark-for-manufacturers-.htm and the Work and Pensions Select Committee recently concluded that it was unlikely that the government would meet its take-up targets for the programme.

- The TUC analysis refers to long-term youth unemployment as unemployment of six months or more using the International Labour Organisation definition. The cuts in support are calculated by applying a cut of £270.58 per person to all young people in each region who are claiming JSA.

- All TUC press releases can be found at www.tuc.org.uk

- Follow the TUC on Twitter: @tucnews

- On Saturday (20 October) thousands of people from across the UK will be heading to London for A Future That Works - a march which starts on the Embankment and ends with a rally in Hyde Park. The day is being organised by the TUC in protest against the government's austerity measures and calls for a new approach which puts growth and an economy that works for ordinary families at the heart of government policy www.afuturethatworks.org

Contacts:

Media enquiries:
Liz Chinchen T: 020 7467 1248 M: 07778 158175 E: media@tuc.org.uk
Rob Holdsworth T: 020 7467 1372 M: 07717 531150 E: rholdsworth@tuc.org.uk
Alex Rossiter T: 020 7467 1337 M: 07887 572130 E: arossiter@tuc.org.uk