Five facts and a partnership approach to tackling youth unemployment

Rhian Johns is Director of Policy and Campaigns at Impetus – The Private Equity Foundation. She has more than fifteen years’ experience in marketing and business development, most recently for IBM, but prior to that as a coach in an FE college teaching careers education and personal development skills to young people. Rhian spoke at NPC’s seminar on youth policy.

I spoke at yesterday’s Guardian and NPC event ‘Can we prevent a lost generation?’ from a funder’s perspective, setting our role in filling the funding gap to prevent a ‘lost generation’.

The first thing that we all must do is stop labelling our young people a ‘lost generation’. The lack of hope that ‘lost generation’ embodies puts us in danger of creating a self-fulfilling prophecy.

With over one million young people not in education, employment or training (NEET), youth unemployment is one of the most critical issues of our time. And this is not purely a result of the recession or austerity measures; youth unemployment has been rising since the early 2000s.

To stop this trend and fix the deeper structural issues, we must focus our attention on another, but strongly related scandal: the large number of young people failing to successfully transition from school to work. Many young people are being let down, as they leave school without the skills or experience that employers look for. Ultimately, this amplifies the existing trend and fuels an even greater youth unemployment crisis.

My presentation focused on five facts that contextualise why funding interventions that support the school to work transition helps us to effectively address this crisis. I also highlighted actions that funders can take to play their part in reducing youth unemployment.

Five facts:

• Too many young people are not successfully transitioning from education into employment. In England, 48 per cent of NEETs have no experience of sustained paid employment beyond casual and holiday work. That’s over 450,000 young people unable to transition from learning into employment[1].
• Skills needs have shifted, making it harder for young people to enter the workforce. More than one in five employed young people are in sales or customer service. For those with less-developed soft skills, accessing the labour market has become more difficult. There is greater pressure for young people to be job-ready and able to perform from day one[2].
• Employers contact at school reduces the likelihood of young people becoming NEET. Research shows that young adults with ‘four or more employer contacts’ are five times less likely to be NEET than those with no involvement[3].
• Changes in Careers Education and Careers Guidance are likely to compromise the quality and availability of provision. Schools are responsible for securing independent and impartial careers advice, but have not been given additional funding to do so. At the same time, changes in the occupational landscape and reduced demand in the economy mean that choices are becoming more complex and opportunities more competitive[4].
• Employers are reluctant to hire young people. A survey of 1,001 employers carried out in 2010 found that only 35 per cent would consider 16–17-year-old school or college leavers for vacancies; and only 57 per cent would consider 18–19-year-old leavers[5].

In order to fix these structural issues, funders must work in partnership with government, educationalists and business, and involve young people every step of the way. The following three recommendations are not exhaustive, but can play an important role in helping the most impactful interventions to scale:

1. Funding scale-ups – By funding and supporting charities with successful interventions to scale their operations, more young people can benefit. Helping them build an evidence base for their work is also essential. Many social enterprises are looking at how to diversify their funding streams and foundations like Impetus – The Private Equity Foundation (Impetus – PEF) can play a critical role in helping them to become investment-ready.
2. Social Investment – New funding models, including social investment, may help funders maximise their impact. A recent Impetus – PEF report investigated how social investment can help narrow the attainment gap. Our findings revealed three areas where social investment could play a role: ensuring the £2.5 billion pupil premium is directed at social enterprises with a proven impact, growing the social impact bonds market, and helping new entrants into the post-16 education market[6].  Funders should be helping social enterprises become investment-ready by investing the funds and supporting the organisations to access social investment to scale their operations.
3. Bridges between employers and schools – Many donors have the will to get involved with young people, and organisations like Impetus – PEF can provide that bridge. One successful example is our ThinkForward programme, which supports those students furthest from the labour market in their transition to work. Corporate partners provide these young people with employer contacts, business mentoring, careers days, placements and skills workshops. We also encourage donors to review their HR practices to ensure they are youth friendly. Often we hear, “are young people ready for work?”, but we also need to ask, “are employers ready for young people?”

Funders alone do not have the answer, but by working in partnership with government, educationalists and social enterprises we can play an important role in helping young people transition successfully from learning to earning and in turn reduce the number of unemployed youth.