Jobless

The huge variations in youth unemployment levels across the UK have been revealed in a new study, which found over a quarter of 16 to 24-year-olds in Bradford, Middlesbrough, Swansea and Wolverhampton are now unemployed.

The study, commissioned by accountancy firm EY, revealed youth unemployment rates ranging from 18.3% in the North East to 11.2% in the East of England.

Coventry had one of the lowest youth unemployment rates out of the 48 UK cities reviewed, at 8.2%.

The study found that out of 48 cities examined, the majority of youth unemployment rates were higher than the regional or national average, the largest gap being in the East Midlands, where Leicester’s 23.6% youth unemployment rate was 11.9 percentage points above the regional average of 11.7%.

According to the report, in 2015 the North East has the highest youth unemployment rate amongst UK regions (18.3%), which partly reflects the region having the highest total unemployment rate of 8% versus the UK’s 5.3%.

Between 2004 and 2015, youth employment rose only in London and marginally in the South West, falling in the other seven English regions, as well in Scotland and Wales.

London’s youth unemployment rate is high compared to other regions (17.9%), but on a positive note it also has the highest proportion of the population aged 18 to 24 who are in full-time education (39%).

The East and the South West have the lowest proportion in full-time education (26% and 29.4%) and the lowest unemployment rates for young people.

Mark Gregory, EY’s Chief Economist, says: The wide variations in youth unemployment rates between the UK’s cities and regions underlines the importance of locally devised policy interventions, albeit coordinated nationally.

“A coordinated response from Government and business is needed to close the skills gap and secure the future prospects of young people, and the UK’s economic prosperity and growth.

The figures come at a time when the UK’s future supply of labour and skills is at the forefront of many employers’ minds since the vote to leave the EU in June.

The huge differences in unemployment among young people could have an impact on the UK’s aspiration to achieve ‘inclusive growth’, particularly in a Brexit environment.

Mr Gregory added: “At root level, employers have an important role to play by providing young people with the vital skills, experience and opportunities necessary to secure work in the 21st century”.

The report also revealed an excess in the UK unemployment rate for 16 to 24-year-olds.

Between March and May 2016, youth unemployment rates were 28.7% for 16 to17-year-olds and 11.6% for 18 to 24-year-olds in the UK.

However, the rate of youth unemployment in the UK compares relatively well to that in most other countries in Europe. Although the UK rate is almost double that in Germany, it is significantly lower than the youth unemployment rates seen in France, Italy and Spain, with rates reaching almost 50% in these countries.

Mark Gregory, EY’s chief economist, says: “The skills agenda is fast becoming one of the biggest priorities for UK business, with Brexit also likely to impose some restrictions to the free movement of labour in the future.

“It has never been more important to ensure the UK has the right mix of skills and talent, both nationally and locally, and young people are core to this”.

The report forecasts that between 2015 and 2030 the UK’s employment in distribution, hotels and restaurants will grow by an average of 0.4% a year, matching the forecast growth of the UK’s total employment.

Over the same period, the report forecasts employment growth in other services by 0.9%, strongly outpacing the average across UK sectors.

Giving young people better working prospects

Maryanne Matthews, chief executive of EY Foundation, says that employers have an active role to play in ensuring young people from disadvantaged groups can make a successful transition from school into work.

She said: “It is imperative that UK employers open their doors to invest in developing the skills of young people. By offering paid work experience opportunities to young people, this could lead to jobs in the future, reduce unemployment rates and help to address the UK skills gap.

“The more that employers play an active role in developing young people, the more we can help every young person to have better working prospects now and in the future.”