North West Youth Employment Convention Pat Russell – Young People and Employment Division, DWP 23 November 2011

NEETs and Youth Unemployment

The historical context For 18-24s, the proportion not in education or work fell until Some of the improvement has been lost in the recession… Higher participation in education and rising employment meant the proportion of 18-24s not working or in FTE fell from 25% in 1992 to a low of 17% in The position worsened slightly up to 2008 and then more sharply as higher participation in education was more than offset by falling employment in the recession. Most of the rise in worklessness since 2008 reflects a rise in unemployment rather than inactivity. UK: % not in work or full-time education/%NEET Source: LFS, ONS

Key facts The youth population is diverse and most are in work or studying. The trends are different for 16-17s and 18-24s. The proportion of 16-17s not in education or work worsened up to 2005 but has since improved. For 18-24s the proportion not in education or employment was falling until 2001 and then levelled out, but some of this improvement has been lost in the recession. Overall trends are determined by changes in the numbers staying in education and the numbers not in education finding and staying in work. Participation in education has trended up since the 1980s, with 80% of year olds in FTE and over 90% in some education or training; equivalent figures for 18-24s are 30% and over 40% respectively. The employment rate of 16-17s not in education has fallen over the last decade, while that for year olds has fallen in the recession. Young people move more often between jobs and into and out of education. As these transitions are not always seamless, youth unemployment tends to be higher than for over-25s. However, most spells of unemployment are short and youth unemployment remains below the peaks following past recessions. Spells in inactivity – especially if on inactive benefits – tend to be longer. Most young people who make a new claim for JSA leave quickly – 60% within three months and 80% within six months. Exit rates have improved over the last year but remain below pre-recession levels.

What we know about the characteristics of young people who are NEET Most young people do not spend any time NEET and have positive expectations for the future. A minority of young people are at risk of becoming long-term NEET, particularly those from workless backgrounds, those excluded from school and those who do not do well at GCSE. Nearly half of those who get no qualifications at GCSE spend a year or more not in work or education by the time they are 18. There is a strong link between a young persons background and likelihood of becoming NEET. The NEET rate at age 17 for those from non-professional parents is about four times higher than for those with professional parents. Care leavers are particularly at risk of being NEET – around 30% of 19 year olds who were formally in care are NEET. Children in care have poorer educational outcomes, however the proportion NEET does not vary greatly for those without or with qualifications. Young people from workless backgrounds and areas struggle to find work and have low expectations for the future. However, a common theme expressed by young people is the desire to work rather than spend their lives on benefits. Other groups like recent graduates, despite recent high unemployment, can still expect to do much better in the future.

Priorities for Youth Employment and Welfare Reform

Supporting Youth Employment -Five Priorities Raising attainment and ensuring that young people have the skills they need to compete in a global economy, including through quality vocational education and training. Helping young people at risk of falling through the net, by supporting local partners to provide effective, co ‑ ordinated services. Encouraging employers in both the public and private sectors to help inspire young people and to offer more work experience, internships and Apprenticeship opportunities to young people. Promoting personal responsibility by ensuring that work pays and that those on out ‑ of ‑ work benefits who can work prepare and search for work effectively. Creating the wider conditions for balanced, sustainable growth, including through protecting and extending the flexibilities of the UK labour market.

DWP policy direction Transformational reforms of benefit system and the introduction of Universal Credit, to make work pay. People on out-of-work benefits expected to take opportunities offered. A clear strategy for supporting young people into work whether they need short term or more intensive long term support. For those who are closer to the labour market, the focus is about engagement in real work with employers and keeping people active in their job search We are modernising the way Jobcentre Plus delivers its services. More responsibility for Jobcentre Plus advisers to assess customers’ individual needs and offer the support they see fit For those who need more help we have the Work Programme, giving more freedom to providers, leaving them to make judgements about how best to support jobseekers who need extra help and doing away with the prescriptive employment programmes of the last Government. Getting Britain working requires the support of all our partners. Jobcentre Plus, service providers, local authorities and employers of all sizes need to come together in their communities and find new and innovative ways to support people back to work.

Delivering Employment Support

Jobcentre Plus offer for JSA customers The Challenge JCP responsible for administering out of work benefits system Previously done using highly standardised operating model One size fits all is ineffective and inefficient The New Proposal JCP managers and advisers given as much flexibility as possible Trusting frontline advisers to use skills to give customers the help they need Flexibility supported by new JCP performance framework JCP will be judged by its results not by its activity The new support model will consist of –Face to face meetings –Flexible adviser support and a menu of customer provision

Peer to Peer Volunteer Advisors Mentors Work Clubs On Line Networking Work Experience Internships Work Pairings Mandatory Work Activity Apprenticeships Volunteering Work Together, inc National Database of Opportunities JCP Engagement with local voluntary Sector Enterprise New Enterprise Allowance (including mentoring and financial support) Enterprise clubs Self-employment guidance Jobsearch Advisor Support Jobsearch training Job vacancies database On line support Careers Advice JCP Group Sessions Skills Basic Skills Support Occupational Training, including sector-based training and Service Academies Other training provision available through the skills system Advisers will have flexibility to respond to the needs of individual customers: There will be a fully diagnostic interview with a customer at NJI / first WFI to determine the level and type of support the customer receives Advisers will agree a personalised ‘contract’ with the customer Advisers will be able to give each customer the support they think they need, using the ‘time bank’ approach to adviser interventions They will be able to refer customers to support based on their individual needs and barriers Different support will become available at different points of a claim for JSA customers There will be some flexibility to defer referral to the Work Programme based on activity undertaken via Jobcentre Plus The flexible menu will be underpinned by the refreshed Jobcentre Plus Performance Framework District Managers will have flexibility to respond to the needs of the local labour market: The menu of support below will in principle be for all Jobcentre Plus customers, though some may be restricted through national policy District Managers will have some choice over which elements to offer Subject to ongoing policy discussions, they will choose how and where to target the Flexible Support Fund Some types of support will be targeted at certain disadvantaged areas, and not all support will be available in all areas Flexible Support Fund Discretionary funds to help customers overcome specific challenges to employment or to support partnership work to tackle disadvantage N.B. Policy still under discussion ESF Funding to support specific disadvantaged customers through locally prioritised contracted provision Funded separately from other support Flexible menu of support

Get Britain Working measures To Get Britain Working we also need to harness a wide range of talent, ideas and good practice – from business, the public and from the charitable and voluntary sector and local deliverers of services. With this help we are enhancing the support that remains at the heart of our commitment to help newer customers into work. This includes the development of a number of Get Britain Working measures:  Work Clubs to encourage people who are out of work to exchange skills and share experiences,  Work Together to develop work skills through volunteering,  The New Enterprise Allowance and Enterprise Clubs to support unemployed people who wish to move off benefits into self-employment.  Work Experience to help young people gain greater insight into work;  pre-employment training and work placements through Service Academies.

The Work Programme A single programme that allows providers to design support based on the needs of individuals Increased flexibility so that providers are able to concentrate their resources on helping people into work Payment largely through job outcome payments rather than process payments, and rewarding providers for keeping people in work for longer than ever before Providers will be given longer to work with customers (at least 2 years) so that there is a real incentive to invest in customer support Minimising the amount of money we pay providers for outcomes that would have happened anyway without their support Ensuring that providers are incentivised to help all customers by paying more for customers further away from the labour market

DWP has also…. launched a £30m Innovation Fund to develop innovative solutions to help disadvantaged people, focussing on young people who are NEET or at risk of becoming NEET enabled early access to the Work Programme for 18 year old NEETs who had been on JSA when 16/17 because of hardship and now provides job search support for 16 and 17 year olds on JSA by making available access to JCP advisor support

Apprenticeships

Making Apprenticeships work for young unemployed people In the Budget 2011, Government announced an extra 40,000 apprenticeship places targeted at young unemployed people Work Experience extension period where employers offer a apprenticeship Closer working between Jobcentre Plus and the National Apprenticeships Service

Pathway to Apprenticeships The Access to Apprenticeship Programme will: provide help for young people aged who need that little extra boost in moving into employment as an apprentice. enable everyone to progress into a full Apprenticeship as quickly as possible – and within 6 months enable participants to spend the majority of the time on the ‘Access to Apprenticeship’ pathway in the workplace help more young people develop and demonstrate the skills and knowledge employers look for in apprentices

Future direction of the Apprenticeship Programme Government is committed not only to increasing the number, but also the range of Apprenticeships on offer, whilst improving their quality We are reshaping the Apprenticeship programme so that Advanced Level becomes the level to which learners and employers should aspire We want to ensure clear progression routes into the programme, through the different levels and beyond into higher level skills and higher education

Future direction of the Apprenticeship Programme Supporting small employers to take on more apprentices 20,000 places available in the first year with the new subsidy. Streamlining processes so it takes less time to recruit an apprentice Removing unnecessary burdens imposed on employers and making it easier for them to offer Apprenticeship places Cracking down on poor quality provision