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February 13, 2012 / Mervyn Dinnen

Some Thoughts About Youth Unemployment

I’ve been worried about youth unemployment for some time. The recent rise to a figure over a million has really put this at the top of the agenda, both politically and in our everyday lives. Most readers will know someone who is either trying to get a start in the world of work, or will be doing so in the next few years.

But the problem is much wider than we think. The uncomfortable truth is that youth unemployment has been rising stubbornly for 10 years or more. The global downturn has thrown more graduates on the job seeking queues but for one category this has been happening for years.

The graph below shows how youth unemployment rose from 11.7% in 2001 to 19.6% in 2010 (it’s over 21% now) – between 1990 (not on graph) and 2001 it rose very slightly, from 10.4% to 11.7%, but between 2001 and 2008 (start of the recession) it rose from 11.7% to 15%…and this is during an economic boom.

 

 

 

 

 

 

 

 

 

 

Now look at this graph – taken from a House of Commons briefing document on Youth Unemployment from January 2011 – which shows it much more starkly, and also shows where the real problem lies…

 

 

 

 

 

 

 

 

There are considerable differences between the rates of unemployment for 16-17 year olds – 38.4% in January 2011 – and those for 18-24 year olds – 20.1% a year ago. The rate for 16-17 year olds has followed a different pattern since the mid-1990s – unlike the rate for 18-24 year olds, it did not drop between the mid-1990s and the mid-2000s.

For more commentary around this you should read two pieces by the Daily Telegraph political and economic blogger Daniel Knowles – his provocatively titled There are no jobs left for the dim and the more recent Youth unemployment is the inevitable result of globalisation.

One thing is clear, there are no longer clock on/clock off, 9 to 5, conveyor belt style jobs for those who leave school at 16 with precious few skills and qualifications. The kind of jobs that used to provide some security and the chance at least to earn a regular wage, raise a family and make a contribution. Alas manufacturing employs about a third of the workforce it did 30 years ago and many lower skilled jobs have been swallowed up by technological advance and outsourcing.

And the situation is getting worse. The kind of entry level jobs that a service sector dominated by retail and leisure could offer – say shelf stacking in a supermarket – can now be done by unemployed graduates, at the taxpayers’ expense with no cost to the employer.

Of course we all know about the ‘snooty’ (sic) graduate who wasn’t happy about working at Poundland…except that most people with a view got it wrong. She had ALREADY done the work and found – as I would have thought anyone involved in HR or recruitment would have realised – that the ‘work skills’ she got were of no use in the employment market, and that doing the work took her away from her search for a job.

She had also done her homework and found that both the previous government, and this one, had research to show that workfare – or work for your benefits – doesn’t work. In fact from studying similar schemes in the US and Australia the writers of the report found no evidence that these schemes help people gain employment.

So if our young ‘blue collar’ jobseekers can’t get shelf stacking work, what are the equivalent jobs at entry level today?

Call centres? Customer service? –  all jobs that need a level of social skills, conversational ability and awareness that they are unlikely to possess.

Barista?? – you need to be a graduate…and according to this piece in the London Evening Standard possibly not one from the UK either.

With 40% of  16-18 year old school leavers unemployed, this is not just an employment problem…it’s a social problem.

I believe that there is some momentum within the Recruitment and HR sector to try and make a difference here. Last week’s blog from Neil Morrison was well received, and the RECs Youth Employment Taskforce has some good recommendations. And it’s my belief that in the absence of growth we need businesses to take more action despite the cost.

I do hope that attention is turned towards the 16-17 year olds, as most headlines and thought pieces invariably focus on unemployed graduates.

Barely a day goes by when I don’t hear someone complaining that they have a trainee vacancy for a graduate but, despite high youth unemployment, they can’t find anyone. The statement is usually suffixed with a ‘when I left uni we took any job to make sure we had work’ – and they are probably right.

During my time working in the recruitment to recruitment sector I spent quite a bit of it sourcing trainees…they always had to be graduates, even though the role was in essence a business to business sales role. There was a definite shift from mid 90s to early 00s though from graduates with work experience within a sector or industry to those with little work experience who could demonstrate sales ability. I certainly wouldn’t have been able to place anyone whose work post university had been barista, customer service or shelf stacker.

But sales nous wasn’t all. They needed to demonstrate an interest in the recruitment sector. They needed to know how it worked, and be able to demonstrate why they wanted to work in it, showing how their personal skills would add value to a company. They had to go through 2 or 3 rounds of interviews, possibly with an assessment sector thrown in. They needed to demonstrate hunger – not just hunger to get a job, but hunger to work within THAT sector doing THAT job.

Not sure how many of the ‘when I left uni we took any job to make sure we had work’ brigade had to go through that.

Not easy to do if you’re in the job market looking for employment and would quite happily work in any job…which after all is the flexibility we expect to see in our unemployed graduates.

And once they have demonstrated all of that knowledge and desire they get a probation period, followed by KPIs and regular performance management reviews at which they need to show progress and a commitment to advancement.

So returning to the ES piece I first linked to above, what are some of the qualities you need to demonstrate to secure a job in the boot camp kitchen of a chain of sandwich shops, working for 32p an hour above minimum wage (and £1.90 an hour less than ‘London living wage’)?

Honesty and flexibility – these are actually part-time roles and you need to be available to come in at short notice.

Commitment – they will invest a lot in staff training, so don’t want people who say, ‘I really want to be an architect’ (sic)

Research – yep, you need to know all about the company

Prepare your spiel - examples of previous roles where you have shown the core characteristics (not easy if you have little or no work experience)

Keep smiling and muck in…and the list goes on.

It’s a lot for a part time minimum wage role, but you see they want people who actually want to do this for a career…not those who would rather be doing something else. Rather like the recruitment trainees I mentioned before.

So next time you want to know why an unemployed graduate isn’t applying for your role think about what you want from them and what they are going to have to do to convince you (or your client) to employ them.

And try to think skills. I attended a very illuminating session from Heidricks at the HR Directors Summit recently in which they presented their global report on talent outlook to 2015 with some findings on future trends.

One was that today’s entrants in to the job market will have had 14 jobs by the time they are 38 – which is probably correct given the fragmented, part time nature of many of today’s roles.

The other was that they are loyal to their skills. Previous generations were loyal to a company, a job, an industry, but these guys will be loyal to their own skills and knowledge.

Maybe instead of advertising for that job you should advertise for the skills you want.

Hiring companies are no longer looking for someone who just wants to work…they are looking for someone who wants THE work. This is a shift that I don’t think we take into account enough.

A final thought and a final link. Youth unemployment is a scar that could end up blighting our society for generations to come. And it’s global. If you haven’t already read about how Apple’s global success hasn’t translated into domestic jobs, you should.

 

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9 Comments

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  1. @Shottty / Feb 13 2012 10:44 AM

    Like this post a lot. It connects the dots between data, employer motives and market behaviour of young unemployed. Will also help my rants on topics like unpaid internships, become more erudite!
    With the emphasis on ‘think skills’, the article reaffirms two recurrent thoughts that I have:
    1. Apprenticeships for the 16yr old school leaver category is the way forward. A more equitable skill building and reward model than many internship and work experience schemes. Also a real opportunity to accrue wider societal benefit.
    2. Undergrads will start to base decisions about course selection, based on employability and
    the ROI against tuition fees (initial data does not support this, but I still posit that this behavioural
    shift will happen with a time lag). Their approach to market as graduates will be far more informed and savvy, than most corporate grad employers are ready for. Market behaviour will remove the bogus grad employer (boot camp type of stuff) referred to above (caught myself sounding vaguely Thatcherite – I’m not for the record!).
    Unfortunately, my comments do not address immediate need though.
    Cathartic comment done. If you’re going to comment great, troll me I’ll just blank you.

  2. Alasdair Murray (@Alconcalcia) / Feb 13 2012 11:34 AM

    Wasn’t it always destined to happen that in an ever more automated, technology driven world that there would slowly but surely be fewer and fewer actual jobs around? Sure, there are jobs out there, but for years, decades even, certain industries have either been decimated or been employing fewer and fewer people. Also, who knows for sure how many jobs there actually are available? In a world where a job can be aggregated onto a 100 job boards how does one keep tabs on the reality? Sorry, just thinking off the top of my head (never wise) but, having worked in the newspaper industry when there were riots over the cuts being made when technology hit home in the mid 80s, seeing how industries like manufacturing have declined and often reading about so and so cutting 2,500 jobs overnight it does make me wonder how we will ever get back to anything like a position where youth unemployment will ever be anything but the ongoing problem it has become.

    • @Shottty / Feb 13 2012 12:08 PM

      Good point Alisdair, the other key consideration is about individuals sense of self worth and the role that work plays in that. Even though, full employment might be incongruous with economic trend and historical data, the need for someone to ‘work’ still needs to be fulfilled somehow.

  3. botters92 / Feb 13 2012 5:15 PM

    Reblogged this on The Game Changer Project.

  4. redspotcoach / Feb 13 2012 5:48 PM

    An interesting unpicking of the figures. Even holes in the road are dug by machines, not by pick and shovel. There are however new kinds of service jobs – somebody is staffing all those nail salons. Yes, they need interpersonal skills.

    The trade off of the minimum wage is that people with low skills cannot price themselves into a job. Once in the job, they can build work and social skills, justifying higher pay. But a minimum wage is what we want.

  5. Roger Philby / Feb 13 2012 10:27 PM

    Merv, great blog, well thought through and data led as usual, nice. I also read the Telegraph piece, which on the whole I thought was nonsense.

    The problem with the new economy is we are using old data to assess an individuals “usefulness” to it. The school system is not preparing our children from the age of 5 for the life issues and jobs in the market place…we need to re-evaluate What Good Looks Like for todays world, it does not take Einstein to work out that what our schools are producing or not, is not it.

    This is not a skills issue; this is a behaviour issue, it’s a values issue, it’s a motivational issue. It’s an issue of parenting and schooling firstly and an issue of organisational laziness secondly, a laziness by the way that has them paying more for talent than they should whilst also missing out on great (and cheaper) talent.

  6. Christine Livingston / Feb 14 2012 2:59 PM

    Great post, Mervyn.

    I think that one of the problems is that the Western world – and increasingly countries in the East too – works from an economic paradigm of relentless growth. Not that there’s anything fundamentally wrong with growth, but it seems to me that it has been about “growth at any cost” over the last how many ever years.

    We all think it’s wonderful when Apple and all these other huge companies turn in bigger and bigger profits – well, at least their share holders do. But these massive expansions come at the expense of people and community. More and more jobs get eliminated as processes are made slicker and slicker. Or disappear all together because they are deemed no longer relevant, or because industries totally dry up.

    So long as this is the modus operandi we all buy into, there will be fewer and fewer jobs in for young people. I guess what we need are some more socially minded entrepreneurs who can demonstrate the value of working to a somewhat different agenda.

  7. LebHR / Feb 17 2012 3:17 PM

    Interesting post you have there, combining some many different ideas and advices to fresh grads .. love it
    i am surprised by the numbers you provided especially for the 16-18 generation, and the world is in a sad situation for employment nowadays. Seriously recruiters, hiring managers, and decision makers should have a wider more open view about recruitment as well as needed job skills. I’ve faced several hiring managers in the past who were looking for a do-it-all person. This is a hard to find person, especially if you’re restricting this much your qualifications.
    Good post!

    ——————-
    Check out our latest post Love Your Job | Positive Attitude
    Are you a job seeker, employee, manager, or HR fanatic? Visit LebHR.com for info and tips.
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  1. The youth unemployment challenge: Day Two of #CIPD12 « change-effect

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