Today marks the launch of a new programme aimed at helping the million young people not in employment, education or training (Neets). The initiative coincides with Andy Burnham's unveiling of plans that prioritize youth, echoing Alan Milburn's review of a 'lost generation'.
Key features of the new youth jobs programme
From today, any employer can claim a £3,000 youth jobs grant for hiring an 18- to 24-year-old who has been on universal credit and seeking work for at least six months. This financial incentive is complemented by Burnham's devolution revolution, which shifts power, funds, and taxes from Whitehall to local mayors, as local areas are where jobs, education, and disadvantage are concentrated. Burnham's confidence in local solutions stems from the success of Manchester's 'working well' programme, which has outperformed national schemes.
The Resolution Foundation has offered a cautious assessment: the subsidy could employ an extra 2,800 young people per year at a cost of £36,700 each. While expensive, it may prevent long-term unemployment and save on future benefits and mental health costs.
Jobs guarantee scheme details
A new jobs guarantee, starting Tuesday, offers employers full wage and cost coverage for hiring a harder-to-place young person out of work for over 18 months. The three-year, £2.5bn scheme begins after 13 weeks of unemployment, with 'intensive work search' and a personal coach guaranteeing an apprenticeship, work experience, vocational training, further education, or a sector-based work academy programme (Swap). The Resolution Foundation estimates this will create 17,500 more jobs annually, at a similar cost to the youth jobs grant.
Historical context: Labour's New Deal success
Labour's flagship New Deal for young people, launched in 1998, was a standout success. Within two years, it exceeded its target of finding work for 250,000 under-25s. By October 2001, the National Audit Office reported it had helped 339,000 into jobs. The success was attributed to the tone and optimism of trained work coaches, who offered genuine choices rather than humiliation. A backstop remained: accept an option or lose benefits, but unlike later punitive sanctions under Iain Duncan Smith and George Osborne, the New Deal aimed to help, not punish.
Preparing for the new youth guarantee, work coaches have received extra training, as many previously had large caseloads and inadequate preparation. A new employee at Severn Trent Water in Coventry, a graduate from De Montfort University, reported that her work coach knew little about available schemes; she only learned of an eight-week placement by accident, which led to a graduate HR programme. Severn Trent, part of a DWP pilot, also takes people with no qualifications and claims 100% pass their missing English and maths GCSE.
Burnham's broader vision
Andy Burnham is looking beyond employment schemes to address why people become Neet. He faces pressure to shrink the welfare budget but rejects 'crude cuts', promising a 'preventative' approach. He takes up Milburn's review, delving into generational, geographic, class, race, and accidental injustices, and integrating local health, housing, and early years support. Problems fragmented in Whitehall silos are better solved together in his 'Manchesterism'. He expects radical changes to the school curriculum, which alienates a third of children, reviving apprenticeships (down 35% for 16- to 24-year-olds since the 2017 apprenticeship levy), and giving technical and further education equal funding and esteem.
Burnham anticipated attacks on his 'No 10 North' plan for a Manchester outpost. The Mail warned of 'tax raids on middle classes' and punishment for 'middle-class southerners'. However, his northern identity has been an asset, while government by and for the south has fueled anti-politics sentiment that contributed to Brexit. Both north and south are shocked by a million Neets, whether moved by pity or anger at the benefits bill. Burnham is right to put them first, meaning youth employment figures will join NHS waiting lists as a key measure of his government's success.
