Joe Dromey is a Senior Research Fellow at IPPR.
Today saw the release of the latest figures for young people not in education, employment and training (NEET). The proportion of young people NEET has ticked up slightly to 11.9 per cent.
While an increase is never welcome, the long term trend has been very positive. In recent years, we’ve seen real progress in reducing the number of young people who are NEET. In 2011, 17 per cent, or one in every six young people were NEET. For the last year though, the figure has remained at a historic low of 12 per cent or below.
But there remains a long way to go. There are still over 850,000 young people across the country who are not in education, employment or training. Young people who are NEET want to work, but they are far more likely to suffer from mental health and substance abuse problems. Beyond the immediate impacts, young people who experience unemployment tend to suffer longer-term ‘scarring’ effects, and are more vulnerable to low pay, unemployment and reduced life chances in later life. Youth unemployment is bad for those affected, bad for our society and bad for the economy too.
While the number of young people NEET has reduced in recent years, it remains significantly higher than in many comparable countries. A young person in Britain is nearly twice as likely to be NEET as a young person in Germany.
Apprenticeships could play a key role in helping this group. At their best, they offer young people the opportunity to earn and learn; the chance to get their first step on the career ladder. But there are serious concerns about how the current apprenticeship system works for young people, in terms of both quantity and quality.
On quantity, the Government are focused on an ambitious target to deliver three million apprenticeships by 2020. They have succeeded in increasing the number of apprenticeships significantly in recent years; from 280,000 in 2009/10 to over 500,000 last year. But all the growth has come from older apprentices. In 2009/10, under one in five apprentices were over 25; today nearly half are. The number of apprentices aged 16-18 has actually shrunk since 2010.
The Apprenticeship Levy is a bold and potentially transformative policy. But in its current form, it risks accentuating this trend. Employers who are subject to the levy may be tempted to hire more older apprentices, including from their existing workforce, rather than recruiting the young people who could potentially gain most from an apprenticeship.
On quality, the current apprenticeship system is letting down too many young people. Young people with a Level 2 vocational qualification are significantly less likely to be in employment than those with higher level qualifications, they have poor wage returns, and they have poor chances of progression. Level 2 apprenticeships don’t seem to offer young people the right blend of on-the-job and off-the-job training; they are often too job-specific and don’t offer enough general education; and they don’t offer the chance for further progression. From next year they won’t even be required to include a recognised qualification at all.
Combined with the stimulus provided by the Apprenticeship Levy, removing the requirement for a recognised qualification may help boost the number of apprenticeships, but it may also undermine the quality of apprenticeships, and devalue the rusted apprenticeship ‘brand’. The Government’s narrow focus on quantity has been to the exclusion of – and perhaps even at the expense of – quality.
In a recent report, IPPR argued that Level 2 apprenticeships should be scrapped and replaced with a distinct pre-apprenticeship programme. In keeping with the most effective vocational systems in Europe, this would offer more ‘off-the-job’ training alongside the on-the-job learning. Offered by FE colleges and other not-for-profit providers, it would include more general education such as English and maths, and it would provide a broad introduction to an industry, rather than being narrowly focus on a role. Crucially, it would result in a transferable qualification and provide the opportunity to progress to higher levels of study. We’ve also called for employers to be allowed to use their Apprenticeship Levy funds to subsidise the wages of young apprentices. This greater flexibility would incentivise employers to take on younger workers, helping boost the flat-lining numbers of young apprentices.
Apprenticeships can help the Government deliver on their social mobility agenda, they could help boost productivity and address skills gaps, and they could help young people make their first steps in a career. To truly unlock the potential of apprenticeships though, the Government needs to refocus their attention away from the raw numbers and really focus on driving up quality, so that young people can get the help they need to build successful and sustainable careers.