Commentary: We need to tackle the mismatch of skills

The recession has rightly focused attention on the need to address youth unemployment. But it is easy to forget that even when the economy was booming and more and more companies were reporting skill shortages, youth unemployment was already rising.

This suggests we’ve failed to ensure that a steady supply of young people are entering work and structured training programmes that will help prepare them for a career. Unchecked this is likely to lead to mounting social problems and weaker economic growth — both costs that society cannot afford.

Yet at the same time we know that business wants to recruit and invest in more young people. Many firms face a ticking timebomb from an ageing workforce and a growing number of them are looking at recruiting apprentices. So this is not just about a weak jobs market but also a fundamental mismatch between the skills that business needs and those possessed by many young people.

So what can be done to address this? In the short term the Government’s Youth Contract programme offers some answers. Firms are enthusiastic about the wage subsidy for apprenticeships and the opportunities for young people to take up short-term work placements while still receiving benefits. The latter can often serve as a trial period for a permanent job or going into an apprenticeship, though employers would like to see this extended to 12 weeks — a closer fit to their probation periods.

However, our research shows that few employers are taking up the incentive to take on a young person from the Work Programme for 26 weeks. Partly, this is down to a lack of awareness of the scheme but employers —many of them facing considerable economic uncertainty — are nervous that someone who has not worked for a long time will not have the basic employability skills needed to go into a programme of work and training.

This should be addressed by resourcing Jobcentre Plus to give unemployed young people the pre-employment training that will prepare them for this.

Looking beyond, we need to ensure young people leave education with better qualifications — as a minimum 65 per cent of them should get five GCSE A-C grades including English and maths — better careers advice and a better understanding of the world of work. Only then can we hope to give the majority of our young people a fighting chance.

Steve Radley is director of policy at EEF, the manufacturers’ organisation.