Youth Unemployment: Government Apprenticeship Drive Failing: Think Tank

Government Apprenticeship Drive Failing: Think Tank

The UK's drive to create apprenticeships has failed to make a dent in the youth employment figures, as companies use the system to train older workers. But the experience on the continent shows that apprenticeships can work. Despite the economic downturn, German and Dutch youth unemployment remains relatively low - 9% and 7%, respectively, in part due to a successful use of the apprenticeship system.

Research from the Institute for Public Policy Research (IPPR) showed on Sunday that out of the 126,000 new apprenticeships created last year, just 37,000 went to 16-24 year olds. In total, 40% of all apprenticeships went to over-25s, IPPR said, as companies use subsidies and tax breaks to give existing employees new skills, rather than hiring new workers.

"It's supermarkets… reclassifying their internal training as an apprenticeship and in the short term taking some money from the government because they do that," Tony Dolphin, chief economist at IPPR said.

"It sounds grander as well, but it's not an apprenticeship as my parents and grandparents would have thought of an apprenticeship, which is someone coming out of school, going into a job, going in to a college one day a week, doing some on-the-job training, following someone around who is doing the job and picking up how to do it. It's someone who's already in work being taught a more sophisticated stock method in a supermarket. It's shorter term, at a lower level and probably less employment generative as well."

Office of National Statistics figures are expected to show on Wednesday that more than 1m people between 16-24 are now out of work - more than 20% of the UK's youth. Apprenticeships have been a major thrust of the government's policy response.

"The government has got to first of all find out whether it's young people that are reluctant to take apprenticeships, or whether it's employers that are reluctant to take them," Dolphin said.

"Assuming it's the latter, which I suspect it is, they've got to find out why. If it's because young people don't have the right level of training or skills to even start an apprenticeship then they've got to look at the schooling… and in the short term they've got to put in place some sort of a pre-apprenticeship system that will get young people up to the required levels."

IPPR has looked at the German model as an ideal, and the experience elsewhere on the continent shows that using internships and apprenticeships can have a significant impact on youth employment.

The Netherlands has the lowest youth employment rate in Europe, in part due to how it has integrated work into its education system.

As Sonja Bekker, a labour market expert at the University of Tilburg in the Netherlands, said. "We have had good school-to-work transitions in the past. Normally people who have recently graduated don't need to search for long for a new job… they gain work experience and networks amongst employers before they graduate."

Most courses include at least a short period of practical work experience, Bekker said. "This is a practice that you see at virtually every level of education."

The country also has a lot of fixed term and temporary jobs, which reduces the risk that employers take in hiring young people, she added.

Germany also has managed to contain youth unemployment throughout the economic downturn. The structure of its economy lends itself well to apprenticeships, given the large "Mittelstand" of mid-sized manufacturing businesses who are able to absorb lower-skilled workers, but the country has also been more effective at making

"[Germany] also has a much more collaborative culture between government, employers and unions on areas around employment and on apprenticeships particularly," Dolphin said. "The government puts more money into apprenticeships, in terms of funding more apprenticeships, the employees or trainees have to take a lower wage in recognition of the fact that while they're apprentices they are spending time out of the job at training and they are not doing the job as a fully qualified person would. And the employers put money and effort into it and take the risk that once they've trained someone up they might go off and do a different job."

With industrial relations in the UK as antagonistic as they are, the cultural shift required would be huge, Dolphin added, but in the medium term "it's an excellent aspiration".


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