Young and jobless: UK's lost generation

Igglesden, 20, of Southend, east of London, finished secondary school two years ago and decided against pursuing a university education because he did not want to graduate with the burden of a student loan and no job. His goal is relatively modest, to work as a sales assistant in a shop, but he said he had repeatedly been turned down because he lacked experience.

“It’s just very frustrating,” Igglesden said. “If you’re lucky, you get a reply, but mostly you don’t hear anything at all.”

To the roster of pain inflicted by the European debt crisis, add this: rising and persistent joblessness among young Britons. Though not at the level of troubled euro zone countries like Greece, and rooted in domestic problems as well, it has reached a point here that is setting off alarms across the political and economic spectrum.

Unemployment among British youth, defined as those 16 to 24 years old, rose above the politically sensitive threshold of one million in the three months through the end of September, the Office for National Statistics said. That is the highest level since 1992.

An estimated 20.6 per cent of British young people not pursuing a full-time education were without a job, an increase of 1.8 percentage points from the previous three months.

The problem is not confined to younger people. Total unemployment in Britain rose by 1,29,000 to 2.62 million in the third quarter, bringing the jobless rate to 8.3 per cent, the highest in 15 years.

Youth unemployment has been climbing in many EU member states as economies struggle and governments impose stringent austerity plans. The youth unemployment rate in Spain reached 45 per cent in the second quarter, the worst among EU members, followed by Greece with 42.9 per cent rate, according to Eurostat, the EU statistics agency.

Britain never joined the euro zone and relies on its own currency, the pound. But the British government, which like its Greek counterpart has cut public-sector jobs and spending to trim a huge budget deficit, blamed the poor employment data in part on the euro crisis, which has depressed demand for British products in European markets and caused British companies to hesitate to hire.

“These figures show just how much our economy is being affected by the crisis in the euro zone,” British Employment Minister Chris Grayling said. “Our European partners must take urgent action to stabilize the position.”

The Bank of England also cited the euro crisis as a reason for slashing its outlook for economic growth in 2012 to 1 per cent, from an earlier projection of 2 per cent, and paring its forecast for 2013 by half a percentage point, to 2.5 per cent.

“Implementation of a credible and effective policy response in the euro area would help to reduce uncertainty and so support UK growth, but its absence poses the single biggest risk to the domestic recovery,” the bank said in its quarterly inflation report.
Recently, the opposition Labour Party warned that the coalition government headed by Prime Minister David Cameron needed to stop blaming the euro zone for Britain’s economic problems and slow down its aggressive spending cuts, which the party says are “hurting but not working”.

Even the Confederation of British Industry, an employers’ group that generally aligns with the economic policies of Cameron’s Conservative Party, called Wednesday for urgent action by the government to get Britons, especially young people, working.

“A generation risks being scarred by the devastating effects of long-term unemployment,” said group director general John Cridland. Rising unemployment among the young is especially worrying because it can easily lead to long-term unemployment and make it harder for the next generation to find its way into the work force, economists and charity workers said.

That would not only hurt economic growth but could also affect youth crime rates, research showed. Reducing youth unemployment by one percentage point could save 2 million pounds, or $3.2 million, by avoiding youth crime, according to research by the Centre for Economic Performance, a research group at the London School of Economics and Political Science.

“If people are brought up in a household where people aren’t working, they miss the role models and are less likely to work themselves,” said Tom Jackson, chief executive of Spear, a charity that helps train unemployed young people.

Memories of recent riots in London that spread to other parts of the country make many people here fearful that disappointment with the government’s austerity policies could quickly set off social unrest. Public opposition against the spending cuts, and those seemingly spared by them, like employees in London’s large financial services sector, has been mounting, as seen in the number of Occupy the London Stock Exchange protesters in tents outside St Paul’s Cathedral.

British unions have warned of general strikes. Abdi Hussein, 24, said he was “fed up” with a government that promised to look after the young and unemployed but failed to do so. “We need the government to say, ‘We’ll give you at least a part-time job if you’ve been unemployed for, say, six months’,” he said.

Hussein has been looking for a job since he had to drop out of a university programme in photography last year because he had run out of money. He now lives on unemployment benefits of 200 pounds a month and regularly visits his local library in London to use its computers for job searches and to send applications. “I tried everything, but people always chose candidates with more experience,” he said. “They say, ‘Sorry, we received 400 applications for one position’.”

Recently, British Business Secretary Vince Cable presented a range of government initiatives aimed at helping young people to join the work force. The government would pay some companies 1,500 pounds to take on apprentices, and hiring processes would be simplified, he said. The initiatives are expected to create up to 20,000 new trainee positions.

Some youth workers and businesses are skeptical. Youth charity TAG director Howard De Souza said the government plans would help those who were most likely to get a job anyway but neglected the less skilled and those without experience.
Federation of Small Businesses chairman John Walker called the youth unemployment figures “truly shocking”.

The government has said it is relying on the private sector to provide jobs for young Britons and voluntary organisations to train them, a policy that draws criticism from some quarters.