Sacrifice Without Sense: We Can't Afford a Million Young People On the Dole

We cannot afford a million-strong army of young unemployed. As a country, we can choose to avoid the costly errors of the past. This is not a price worth paying.

The real tragedy in the news that the number of 16-24 year olds out of work has passed the one million mark, is that it a sacrifice without sense.

A lost generation of young people is paying the price for the government's economic policy. In Japan, in the USA, in the Eurozone countries, youth unemployment is falling. In Britain it is spiralling out of control.

Ministers have scrapped the Future Jobs Fund and Education Maintenance Allowance; you don't need a degree in economics to know there's a link between what ministers do, and young people on the dole.

Yet ministers are blaming everyone but themselves for the sluggish economy. Early this year they blamed the cold weather. Over the summer they blamed the Royal Wedding. This week they are blaming turmoil in the Eurozone. But as the Liberal Democrat peer Matthew Oakeshott said this week:

"It's ridiculous to blame this rise in unemployment on the crisis in the Eurozone. All economists know it's a lagging indicator so this is the result of what has been happening in our economy over the past year, for example the collapse in the house-building to the lowest peace-time level since 1923"

Surely it is time for ministers to take some responsibility for their policy.

Total unemployment rose by 129,000 in the latest quarter to 2.62 million. That's the worst figure since 1994. Youth unemployment now stands at one in five 16-24 year olds, a new record.

What minister's fail to grasp is that whilst growing youth and long-term unemployment is a blow for the individuals and the families involved, it also stores up heaps of trouble for the decades ahead.

In the short term, it means fewer people are rowing the economic boat, paying taxes, and spending their money. That makes the deficit harder, not easier to pay down.

But the evidence tells us that it has an impact in the long-term too. A young person on the dole today is more likely to be unemployed in later life, to earn less, and to suffer health problems. My own constituency of Hodge Hill in Birmingham has the highest levels of youth unemployment in the country - this is a ticking time bomb.

We are seeing scars re-emerging in our society we had hoped had healed. For example, the biggest jump in unemployment has been in the north-east, a region still struggling to transcend the collapse of heavy industry a generation ago.

We saw the decline of towns and cities scarred by long-term unemployment in the 1980s. We saw men hanging around on street corners, in a ghostly echo of the Great Depression. Dramas such as Boys from the Blackstuff, comedies such as Bread and popular music from bands such as UB40 and the Specials depicted the harshness of life on the dole.

Government schemes are not working. The Department for Work and Pensions (DWP) is spending less on schemes to help young people than it does on stationery. The young person has less chance of getting onto a government apprenticeship than an applicant applying to go to Oxford University. The government's Work Programme Scheme sends three-quarters of its alumni straight back onto the dole.

There's another way. Labour has put on the table a five point plan to get the economy moving and increase employment for young people.

Our plan for jobs and growth is sensible, costed and has been subject to scrutiny in Parliament.

It involves immediate action that ministers could take today: taxing the bankers' bonuses to get 100,000 young people into work (jobs they would have to take; no choice of staying on benefits), and to build 25,000 more houses; bringing forward infrastructure projects to boost the construction industry, a temporary cut to VAT to get shoppers back onto the high street; a national insurance holiday for small firms taking on new staff, and a one-year cut in VAT to five per cent on home improvements.

These measures are moderate, sensible and echo what businesses and employers have been telling us they need.

Now is not the time for point-scoring and partisanship. Ministers should look at Labour's plan without prejudice, and choose to implement some or all of its measures.

We cannot afford a million-strong army of young unemployed. As a country, we can choose to avoid the costly errors of the past. This is not a price worth paying.


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