Young men slipping through cracks in economy

Britain’s economy has delivered a bumpy ride for young people in recent decades but it has still managed to suck more of them in. The proportion of 18-24 year olds who are on the sidelines of the labour market – neither working nor studying – has declined since the 1990s. That is no mean feat given the shocks delivered by the financial crisis and the pandemic. Yet the trend is a good example of why it’s important to dig under the surface of statistics. What looks like one story is actually two: one largely positive; the other distinctly worrying.

The biggest driver of the decline in youth worklessness in recent decades is the collapse in the number of stay-at-home young mothers. The number of young women who are “economically inactive” because they are caring for family dropped 78 per cent between 2006 and 2021, according to an analysis by the Resolution Foundation. The trope of the teenage mum living off benefits is badly out of date.

There are two things going on. Fewer young women are having babies, and those who do become young mothers are now more likely to work. Lower birth rates among young women are a broader societal trend common to many countries, though UK policymakers did apply an extra push with the introduction of the Teenage Pregnancy Strategy in 1999. Given that teenage mothers are less likely to finish education and more likely to end up in poverty, this trend is worth celebrating.

Childcare provision

Higher employment rates for young mothers, meanwhile, are probably the result of various factors, including somewhat better childcare provision. Benefits were also made more conditional after 2008 to encourage more lone parents into work, which will apply to some (but not all) of this group. Evaluations of that policy change point to mixed results. Lone parents did become more likely to work, but many ended up in low-paid, part-time jobs. One government survey found that a third of the respondents who had entered work said they earned less than £6 (€6.95) an hour, though the minimum wage was £6.08 when the survey was done. Finances did improve in households where lone parents found work, but the survey found that two in five were still in “material deprivation”.

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The other story hidden in the youth worklessness data is more troubling. The proportion of young men who are inactive (neither working nor looking for work) has climbed steadily from 5 per cent in 2000 to 9 per cent last year. The UK isn’t the only country to see men drop out of the labour market: in the US, economists have mooted a number of explanations including the allure of video games. But Louise Murphy of the Resolution Foundation says the UK data suggests a major reason for rising inactivity among young men is ill-health, particularly mental health. The same trend is evident for young women too, though not as strongly.

Mental health

Is mental health really worsening among the young or is there a greater awareness now of mental health problems that people struggled with for decades but weren’t willing to talk about? Tony Wilson of the Institute for Employment Studies says the consensus is that “It’s a bit of both, but it does appear young people’s mental health is getting worse.”

Helping these young people to recover will require mental health support and treatment to be more widely available. Local authorities and charities might need more resources to find and support them. They might also need more specialised help to find their way into the labour market. But many of these young people are not “in the system” because they are not claiming benefits: only 44 per cent of workless young women and 32 per cent of workless young men were on income-related benefits in 2019. While that saves the taxpayer money in the short term, it also means they are harder to reach.

In Britain, you get career advice at school (though many young people complain about its quality) and job-hunting support if you are on benefits. Outside that, there is little help available from the state. Most other European countries, Wilson says, have public employment services that extend job-hunting and career support for people who aren’t on benefits.

There is a case for the UK to follow suit with a modern public employment service open to all. Young people wouldn’t be the only ones to benefit, since the pandemic has triggered a swathe of older people to drop out of the labour market too. But for the young, a bad start is particularly hard to recover from.

Britain can’t afford to let anyone slip through the cracks; its young people least of all. – Copyright The Financial Times Limited 2022