In a bid to deflect criticism over scrapping a £1 billion fund aimed at tackling youth unemployment, the coalition government has pledged to spend £60 million on creating apprenticeships and work placements in private companies.
The ‘Supporting Youth Employment’ scheme is intended to fund 250,000 apprenticeship places for 16- to 24-year olds over the next four years and 100,000 work placements over the next 24 months. More than 100 large companies and nearly 50,000 small ones have already pledged to offer work experience positions to such candidates.
The plan, jointly announced by Prime Minister David Cameron and Deputy Prime Minister Nick Clegg at an event in London yesterday, will also include a two-year pilot project to provide 50,000 youngsters with six-week periods of intensive support to find a job.
Such support will include help with training, childcare and presentation skills and participants will be guaranteed an interview at the end of it.
Cameron said: “It’s time to reverse the trend of rising youth unemployment that has held back our country for far too long and help our young people get the jobs on which their future – and ours – depends.”
The government also intends to set up a new £10 million ‘innovation fund’ to support the voluntary and community sector in helping young people to find work.
The move comes after the government has come under fire for scrapping the £1 billion Future Jobs Fund, a scheme set up by the previous Labour government to help mainly young, unemployed people back to work.
Shadow employment minister Stephen Timms said he was pleased that the government was now starting to try and tackle the youth unemployment problem but added: “It is a rather inadequate response as well as being an overdue one.”
The £60 million being spent was equivalent to the amount the Department for Work and Pensions spent on “postage and telephones in a year”, Timms said. While apprenticeships were “potentially helpful”, the “real problem is a lack of real growth in the economy. It hasn’t grown in the past six months. There simply aren’t enough jobs”, he added.
The news came as research published by the Association of Accounting Technicians revealed that 40% of last year’s graduates were ‘underemployed’ in low skilled jobs six months after leaving university. The same was true of 30% of graduates four years ago.
The study, undertaken by the Centre for Economics and Business Research, indicated that new graduates had been among the worst hit by the economic downturn, but the situation was set to get worse for this year’s university leavers. It predicted that 55% of the next wave would either be unemployed or have to work in a non-graduate job six months after finishing their studies.
The report also called into question the value for money of many degree subjects given the debt burden that students faced and the often “very poor returns in terms of improved job prospects”.