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Youth unemployment - a national emergency?

51m 19s

Youth unemployment - a national emergency?

The transcript features an interview with Alan Milburn, leading a government review into youth unemployment and disengagement. He highlights that 1 million 16-24 year-olds in the UK are NEET, a crisis with deep roots in social inequality. The problem begins in early childhood, as children not school-ready by age 4 are far more likely to become NEET. Crucially, the issue has shifted from unemployment to detachment: 61% of NEET youth are economically inactive, and nearly half of 24-year-olds have never held a job, leading to lifelong scarring effects and lost income. A major driver is the sharp rise in mental health conditions and neurodivergence, with health-related benefit claims doubling. Milburn argues the welfare system is broken, automatically signing off young people with diagnoses instead of asking what they can do and providing support. Schools also fail to prepare youth for the labor market, focusing on academics over life skills. He rejects blaming young people, citing examples of youth applying to hundreds of jobs with no response. The review is exploring solutions, including welfare reform, better early intervention, and stronger employer-school links. Despite the grim data, Milburn is optimistic because the issue has become a visceral national concern, with communities and employers eager to act to prevent a generation from being left behind.

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This is a visceral issue for the country, leading this review into young people and employment for the government. If they formed a city, that would be the third biggest in the UK. So it's one in age 16 to 24 year-olds, so the scale of it is enormous. There's so many elements to this, but do you genuinely think we're going to see change? And you might have anxiety and depression. If a diagnosis shouldn't automatically lead to you being signed off by a GP with a fit in the art, then politically this is a huge issue for the government. Let's remember, this is a government that was elected on a one-word slogan. What was it? Change. Hello and welcome to the rest is money with me, Stefan Mugov and now Robert is currently in the Gulf for the Prime Minister at the time of recording this. I'm sure he'll have lots to tell us about it when he's back. So I've been left in charge and today we have a friend of the show on Alan Milburn, who's a familiar face in British politics. He served as Secretary of State for Health and Social Care under Tony Blair. He was responsible for modernising the NHS, marrying together parts of the public and private sector. And he's also hot on social mobility as the former chair of the Social Mobility Commission. And in that vein, he's now very much focused on looking at the issues of unemployment. And particularly those needs we talk about, you know, the 1 million young people not in employment education or training. It's been described as a national emergency. So I want to find out from Alan what the problem is and what he's doing about it. So here's my interview with Alan Milburn. Alan, it's great to have you back. You were last done in July 2024. Now I can't believe that. It doesn't feel like two years has gone by, but, you know, Manini has been the champion really has that. No, I mean, very quiet, very quiet, yeah, not a sling. Things are changing in the minutes at the moment, aren't they? But what is not changing is your focus and mission to try and work out why there are so many young people not in work and also what we can do about it. So when we last spoke to you yet, you haven't started this review. Now you are leading this review and you're quite far into it. There'll be stuff coming out from it over the next few months. But can you just give us a flavor of what you've been doing and where you're at with this? So I'm leading this review into young people and employment for the government. It's pretty wide ranging. So we're doing it in two phases. I suppose phase one is trying to understand who they are. A million young people are there about. So it's one in 1816 to 24 year-olds. So the scale of it is enormous. Who they are, what's going on, where it might go and critically, why do we think it's happening? So that's basically phase one and then phase two. We're looking at, okay, if those are the problems, what are the solutions? So it's a two phase thing. And then in between times, there's a huge volume of interaction. Obviously with young people, I spent part of yesterday with a group of young people talking about their lives, what's going on, their aspirations, their hopes, the dreams. A lot of visits to different parts of the country, particularly where young people who are neat are concentrated because they're in particular places. Maybe we'll come back to that in a bit. Helping a lot to employers, to local authorities, to mayors, to football clubs. Honestly, I tell you what has been really uplifting for me. A lot of it's really depressing because it's really bad and it's getting worse. But what's really uplifting is this is a visceral issue for the country. People are worried about the next generation of young people. I think maybe for the first time, maybe in a hundred years, I don't know. People are feeling parents and grandparents that their kids might be worse off than they are or the opportunities that they had are not going to be available. And people want to do something about it. And that's the reason that I'm optimistic about it. Not just government. Government's got an important role to play, but employers, charities, local authorities, communities, what to do, something about this and boy or boy does something need to be done. Yeah, that's a really interesting point about how, for the first time, in a long time, people think that their children are going to be worse off than them. I mean, that's quite, that says it all, doesn't it? Because the whole thing is that everyone betters themselves. Maybe the first time kids go to uni in the family or the first time they get above a certain pay and income and that is just, God, it says it all that that people feel so, I guess, pessimistic. Alan, there's loads more I want to talk to you about, but let's go to a quick break. We're proud to say that the rest of money is powered by Octopus Energy this year. Greg Jackson is back to answer another question. Now, this is something that we see a lot that I wanted to ask you about. When you build in a business from scratch, like what's the most important thing early on and what do people get wrong? Yeah, early on, the most important thing is to start building a customer base. Until you've got customers, you have no idea whether the products and services you're offering are going to be the ones that people want. So a lot of people spend far too much time building out pages and pages of business plans, thinking too hard about what they're going to do rather than just doing it. What surprised you most when you were launching Kraken? The great fun of launching Kraken was it was the engine that powered Octopus to grow, ultimately, to the biggest energy supply in the UK with, I think, the best service. But we were able to license it to our rivals as well. So the interesting thing is the world is more complicated than you think, and your competitors will work with you if it's in their interests. Cheers, Greg. Right. Well, you'll be hearing more from Greg throughout the year, but now let's get on with this episode. So tell me about the people we're talking about. I mean, again, you know, living in the North East and spending a lot of time with young people. I see it myself, but what are you seeing in terms of who these people are and what's happened to them? So it's 16 to 24 year olds. Things are changing a bit. There are some constants and some things that are changing. So the constants are, look, it's grounded in economic and social inequality. You're a third more likely to be neat as a young person. If you're growing up in Middlesbrough, for example, which you're very familiar with or how the pool on mostly in the Northwest, the Liverpool are notting them or parts of Islington. And so where there is social disadvantage, there are high levels of neat for young people. And so that's pretty obvious. So neat doesn't begin at the age of 16. Unfortunately, it begins much earlier. In fact, when I was in Bradford, they've got a brilliant longitudinal study of 20,000 young people called Born in Bradford, which they set up 20, 25 years ago. I was actually involved with it when I was the health secretary. And so they've got DNA from these young people, when the little babies, they followed their outcomes over time. What's happened to their education? Here's the really depressing thing. When I was there three weeks ago, the guy, one of the guys who's running a Johns had to meet, look, I can probably predict with a fair degree of accuracy at the age of three or four, who's going to be neat, not an education implanted. - Age of three or four. - Yes, at the age of three or four. And so we know, for example, that you're three times more likely to be not an education, employment or training as a 16 or 17 year old, if you haven't been school ready at the age of four or five, what a school ready means. It means that you're able to put your own court on. You're able to go to the toilet by yourself. You're able to hold a book. You're able to read a few words. So this is deep. I mean, not just about what's going on in the labor market and we can come to all of that, but this goes back to social inequality, lack of opportunity, places that have been left behind. So this is where it's concentrated. It used to be a phenomenon that was associated more with young women than young men. And that's changed. It's now more young men than it is young women in good part for good reasons, because it's a teenage pregnancy of four and so that's, you know, and so young women are, you know, less likely to have young kids than perhaps they were. So, you know, the not so good or caring for their children. That's the profile has changed, but the really, really worrying thing that has changed is two things that related. The first is there's been a doubling in the number of young people who are neat, who report a health condition over the last 10 or 15 years. And very many of them report a mental health or a neurodivergence, conditional agadheed, or asperges or autism, yeah, autism. So, so, so that's a really exponential rise. This is definitely more anxious generation. There's no doubt about that. So that has had a knock on effect into the nature of youth and employment, because it's no longer about unemployment. It's about detachment. 61% of this close to 1 million young people are economically inactive. That means that they're not looking for work. And if you're not looking for work and if you don't have work in your early 20s, the chances that you're going to be in working your 30s and 40s diminish exponentially. And here's the most shocking statistic I've come across so far of many. 45% of 24 year olds who are not an education, employment and training have never. had a job. And if you have another job by your mid-20s, your chances of getting a job in your 30s, 40s, 50s, lack has a long term scarring effect. You can quantify it actually. On average, they could lose up to a million pounds worth of income during their lifetimes, but that's only the tip of the iceberg. So basically, if you're a young person and you don't find a job by the time you're 24, which is this measure of 16 to 24 year olds is what we're talking about. You're unlikely ever to, is basically what you're saying here. Yes, so there's a stickiness and very many, not all of these young people end up in the benefit system, about a third of them don't, which is interesting. So we've got about 300,000 so-called hidden needs that we know very, very little about. They're not even claiming benefits. So we're trying to understand what is going on there, but about 600,000 are claiming benefits. The number of young people 16 to 24 who are claiming health and disability benefits has doubled in the last five years. So this is exponential. So there's something profound going on and it's having a long-term social effect. It has an economic effect because that's fewer people working at a time of skill shortages, lower productivity, lower levels of growth through the economy, and it obviously has a massive fiscal effect in terms of the build to the taxpayer. So all of these things are reasons for deep concern. A big question then, Alan is, what are these 300,000 people doing that? How are they making money? How are they surviving, or if they're not making money? Luna, how are they living? We're doing a lot of polling and survey work amongst young people. They're not in education employment and training. They're pretty hard to reach, but we're doing a lot of polling. We've got a small team going out of the ground with the country talking to young people who are who are neat, by the way, I hear that term, but I'm just. No, I don't. It's a bit like Brexit ahead. That when it came in, it's look. I know, but it's sort of just the short-term, just some people. I've got a small team going out, talking to you in first-of-year interviews with about 400 young people, trying to find out what's actually going on in your life. How do you live? Are you living off the bank of Mum and Dad? Are you living in the house of Mum and Dad? And this is, by the way, one of the repercussions of all this, if these young people aren't working, the chances are that they're at home, in the family home, they don't leave. That has consequences for family dynamics, but it also has consequences for family income, you know, straying on the bank and Mum and Dad becomes even bigger over time. So, look, there's many reasons to be concerned about it. So there was some of the things that we're finding out. Yeah, and obviously one of the things that you often hear particularly from older generations when we talk about young people not being in workers, or that's because it's too easy now to go on benefits. That's because they're lazy, Gen Z don't know the born. When I was a kid, you got sent out and you hear all that. From what you're saying, it sounds that, you know, maybe the welfare system is, you know, too easy to rely on, but that's not the bigger picture you're seeing, because what you're seeing is this is starting at a really young age. It's just starting at a really, really young age. And, you know, I think, you know, I want to avoid the blame game, but if there is a blame game, blaming young people, it's just such an easy lazy and, in my view, wrong assumption. Okay. When I was talking, I was up in Newcastle my month ago and actually where I grew up in Benwell, which you know, on the west end of Newcastle, which is a very good area. And I was talking to a group of young people and you know, one of the lads was telling me he'd applied for 200 jobs. He'd applied for 200 jobs and he hadn't had, by the way, you hadn't had a job interview. Okay. He hadn't had any feedback. And in worse than that, he had another single response. So this is not lack of effort on his part. He's crying. Now, look, there is a responsibility on young people like there's a responsibility on parents and we should be clear about that. If there are opportunities available and the jobs available, they should be going for them. So there's no doubt about that. But I think the problem is really less about is this a snowflake generation? Are they to blame? Or more, what is happening in the labor market and what's happening in the system, which in the end, the state runs from early years all the way through to welfare? And on both sides of that equation, if you're like on the supply side and the demand side, there are there's a big failure. So the failure on the supply side is that if you think about everything from education schools all the way through health, just being mental health issue, all the way through to welfare, the question that you've got to ask is, are those systems set up to enable young people to make the transition from schools and education into employment? And the answer is that they're not and welfare in particular isn't it? It isn't. So rather than saying the first question shouldn't be, what is it your entirety on benefit? The first question should be, what are you able to do? And how can we help you? And you might have anxiety and depression, but that should, that diagnosis shouldn't automatically lead to you being signed off by GP with a fit note, then you're on benefit. You get benefits as a child, child disability living allowance, about 80% of kids who are on child DLA then go on to adult paper, which is the adult benefit for people with health and disability issues. And then you're in the system and you're in the benefit system, what we should be asking is a different question, which is what can you do and how can we help you? How can we support you? And if you need a bit of mental health, can we make that available to you? Can you work a few hours rather than having to work 40 hours? If you do that, the benefit system currently penalises you, which is crazy. Could you do an apprenticeship? Oh, you go on an apprenticeship, you lose your benefits. This is mad. Seriously, when you look at the system through that lens, it isn't a system and it's not incentivising young people to go into work. So, is it, so you do think that there is a problem with the welfare system that needs to change? 100%. Absolutely. And it means I think it's probably to be quite profound. So we're looking at that now, what that, what that could look like. But that's only, by the time you get into welfare system, that's a failure. Okay, that's the critical thing. To use the sort of jargon, it's what happens upstream, the cancer. What is happening in schools? Our schools, every employer will say to me, two things, they'll always complain about the government fair enough. And then they'll always say, young people out work ready. And what does it mean by that? They mean two things, warm, young people are not being acquainted earlier enough with the labour market, the disappearance of the Saturday job and all of that. But also, they're saying schools aren't setting them up with the life skills, not the academic skills that are required to succeed in the workplace. So that's the real question that we have to look at is the curriculum right? Is the way that schools are regulated, recognised, rewarded? Is that setting up young people to be able to succeed in what is a highly competitive and fast-changing labour market? So we're looking at that again, is one of the sort of drivers, if you like, that sits behind us? That to me, I mean, this is exactly what I care so much about because you mentioned my hometown, Middlesbrit, that's where I grew up obviously and that's where I went to school and saw a lot of, you know, young people who didn't have the structure at home to be able to do well at school academically, but what did help and, you know, I talk about this a lot because it's K2Y, I've done well, you know, I've gone divide the odds to do as well as I have. And it's because, it's not because I'm special, it's because the school really recognised that we did have skills, they might not be purely academic, but they are skills that are useful in the workplace, like people who don't have structure at home, often are quite good at talking themselves out of situations, so that's a really good communication skill. Off, for example, really good at assessing risk because they have to deal with it in a, you know, quite challenging way every day. And again, being able to assess risk is a great skill, but, and it was different for me because we were told what skills were and what we're useful, our employers, we did have that link with industry really early on because we were sponsored by industry and we had all that. But the worry now is it's not like that in middle school anymore, you know, I was a bit of a special school, but also now when I'm back there and, you know, we're a lot to the young people there, they don't see themselves as having any skills and that point you make about that disengagement, they just think, oh, it's not, it's not for me, I'm not, you know, if you say to them, well, what are you good at, that I go, I'm not good at maths, I'm not good at geography, I'm not good at it. And you're like, no, no, no, but what, but that's there, they're not jobs. You know, you know, you, you've got all these other things. And as you point out with education, it assesses them pretty much based on the academics. And that's where you lose that engagement because then people feel worthless and then you can understand why it leads to a public health crisis. But that's not a new thing. How is it? Like you're not going to be telling the education secretary or the, you know, whoever else in government anything new. And that's my worry is it hasn't changed, and this is really dangerous. Yeah, but I think we're in a, we're in a perfect storm situation now, because you've got this big change, you know, when it was just youth unemployment, youth unemployment was very strongly correlated with the economic cycle. So basically if there was a downturn or a recession or whatever, economic growth was low, then employers just turned off the recruitment tap from the first people stuff are obviously we and people coming into the workplace. And then when things picked up, the turn the tap back. gone and young people came into the employment market again. But if 61% of these people aren't in the labour market, aren't in the market for jobs, you've got a very different phenomenon now. And what you say about skills is right, which is obviously literacy and numeracy are core skills without bar. You can't stuff in life. So focus on academic standards is really important. But equally nowadays, we've got to have communication skills. You've got to be able to collaborate. You've got to have agility because works changing year, you know, and one job for life anymore, all of that's gone. And AI will transform that even more as we know over time. So the question is, is the balance right in what schools are doing? And I think, you know, a lot of people, not everybody thinks that maybe that balance isn't quite right. And I guess the final point is that, you know, I always look at Kim from like you, you know, I came from, you know, I grew up in first of all, in Taolong County Durham, a little mining town, and then West Ender Newcastle and lots of sort of really very, very poor kids, including me, but everybody had potential. Everybody had some stuff. Everybody had some. Everyone's got skills, everyone's skills. Some sort. And what you can't have is school system that sets up a cohort of youngsters to believe like you were saying that they're failures. They're not good enough. So how can we get that unlocked in each and every one of them to be able to realise their potential? That's the critical thing. I think the final point is the what's changed on the demand side in the labour market is equally important because it used to be that when you and I were growing up, you know, you could get a Saturday job, you could walk into a part-time job, etc. At the nation of the labour market's changing. So what employers are doing is really important as well. So if you look for example at vacancies in, you know, a sector like hospitality restaurants, pubs or hotels where a lot of kids would start their working lives, they're down by 50% in five years. Retail vacancies are down by not quite that, but they've been falling for 10 years. So jobs in shops and hotels and pubs and restaurants where a lot of kids would start their working lives. Those vacancies have been falling. So that's a big problem. Apprenticeships staff are down by third amongst young people in 10 years. So these if you're like entry routes into employment, they are being closed off. And if you put that together with the mental health crisis and some of the failures in the system, you've got quite a big problem. But isn't that partly the government's fault because it has become so expensive to employ young people? So I have a retail business. We employ nearly 100 people. A lot of them are 16 to 24 year olds. Then they are the first time jobbers and they are, you know, some of them are from pretty tough backgrounds and they're often the best ones running the business. Our most profitable store is run by a 16 year old. She's amazing. Yeah, she's brilliant. But it's become a lot more expensive to employ them, you know, we've seen and I understand why minimum wage needs to go up. But it's come all together at once. You've got the particularly for the youngest of the young people. It's come up like 26% over the last year or so and last couple of years to employ them purely on their wages. Then with national insurance contributions on top. Then with business rates going up as well, it's actually really tough for employers to employ young people. And so there is a government problem here with making the industries which provide those jobs. It's just too expensive, particularly as you say hospitality, leisure, retail. They're the ones hardest hit by all of these essentially tax turnages. Yes. And obviously we're talking to a lot of employers, you know, small and medium sized as well as sort of the bigger employers. So, you know, obviously we talk a lot to, you know, I'm meeting the other day with the chairman of Marx and Spence's for example. We're talking to Sainsbury. We're not actually, yeah, exactly. So it's not actually the other day of her at MNSHQ. Didn't know from your sandwich which was very disappointing by the way. But he did tell. The kind of fortune now Alan. But he did tell me that one in eight prawns sold in the UK, sold in Marx and Spence's a little night. One in eight prawns. One in eight prawns. Well, there's a good fun thing to do like that. So you're left something. Yeah. But yes, so I hear that a lot. And obviously look, if you're an employer, you know, I am and have been an employer. Every time we take on a young person, the truth is it's always a risk. Because they're in proven, aren't they? It's not like you're dealing on somebody a bit older and they've got a track record and a CV and they've got a reference. So what we've got to do is make sure that the risks are minimized and the incentives are maximized for an employer. So obviously we're looking at all of those issues in the round and we're looking at what employers could be doing more to make it easier for young people to come into the workplace. The really great thing I'm finding every conversation I'm in with every employer, you know, particularly when you're talking to employees in a local community as part of a local area, they want to do something about it. Now what I do is something not just because honestly because it's a bit of like do gooding or ESG or whatever it is, they want to do it because they themselves very often are struggling to recruit skilled labor. And now that you've got levels of migration falling and a lot of employers have been overly reliant arguably on immigrant labor. That's coming down. In fact, the net level of migration is probably going to be busy zero or below according to the ORBR within the next year, maybe even in this calendar year, employers can't be on easy street anymore. And just assuming that migrant labor is the answer. So they're going to have to find a different source of labor. And that is, you know, there's a big here you have a million young people hold on a minute. Why are we enabling them into the workplace? That's obviously a job for government as well. But it's also a job for employers to think about what do we need to be doing to make it easier for those kids to come into the workplace, particularly if they've got, you know, it's not easy any of this, but particularly if I haven't got high levels of anxiety, for example. Yeah, but as you said, but it's not just costa, it is also bureaucracy because as you said, it's much more difficult now to give kids work experience. Yes. And, you know, for lots of businesses, it's like why bother because it doesn't necessarily mean we're going to get any benefit from it. They might come in, do a week and they'll never save them again. And they have to burden the bureaucracy and the cost and the risk associated with that. And also just given, you know, that the changes we're saying to employment rights and everything else, it's just making it all tricky. It should there not be something just to make it easier for businesses to be able to do all this. Is that what you're, you know, you're focusing on telling government as well? Thinking the end, there's a sort of deal to be done. I mean, my sense is there's a huge amount of goodwill amongst employers. It's not that they want to penalise this generation of young people. They want to provide opportunities for young people. The government can help or hinder that. Some of the things that the government is doing, for example, the youth guarantee, which is offering, you know, it's offering wage subsidies, for example, for young people who've been unemployed for a while, just to help with the costs of them employing people. I think that's a perfectly sensible thing to do. There's a big reform of the apprenticeship system that's needed. Far too many apprenticeships, frankly, go to older workers, which is just when we were growing up, an apprenticeship is all about a young person learning a trade, getting the first, under the first wrong of the career ladder and then progressing. And so we can't forget about the people whose industries are changing and they need to be re-skilled. It's all of that. But it's just overly skewed at the moment and it should be focused on young people. So I think there's a lot that government can do to help with that and government can probably do more. But then I think there's got to be a deal with employers to say, okay, but you guys need to play your part as well. So what are you going to do to turn on that youth recruitment tap? You know, to make, I don't know, supported internships available, flexible working available. And I know all of this I understand you know, as an employer, I know all of these things are not straightforward. They never, they never are. But if we're going to solve this problem, then it can't just be about what the government does. This has got to become a national cause for the country. It's got to become a movement for change where we're all accepting whether as parents, as government, as local authorities, as mayors, as employers, we all have a part to play in solving this. So we've talked, Lord's there Alan about what the problem is. Let's talk about solutions. But first, we'll go to a quick break. 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On the apprenticeship point, again, I did a kind of apprenticeship with Black and Dekka before I went produach o symbolial fusinas yn 카 обorythew. Wel i'n tair o 'okay' ar dywysig llywllanniaen per cymdnu ei e Shit Gilwunaid, i ein bu ddyngudd, Crolr ddidd y byrill mewn i'r fỉyn, а wneud roes, wrth,yn mynd ac iconicó o wnael wel o ta yn y cyma gyd deall roes surprisingienu p 할게요 sylo i fi, fel yn pr魔fa ei'u nyn ar 18 do우 ar ten curi.' L繼續 yn yr fynd i fweithos yn dweud, ac r yer symud hyn 'en ap fel gir, wrth, yn sicrery rhyni chi bydda chi, bydda awannau awyahol метadio y effeiliu Bottua i'r ffundr y cyfyn yn ffundr y cwst yn yw, a lot i'r prysdegio'r ffundr yw'r cyflwyn y llwy'r ydynghyrnyddiad. I'r ydych chi'n gwneud, yw'r cyflwyn y cyflwyn ydych chi'n gwneud, ydych chi'n gwneud. A'r ydych chi'n gwneud yn ymwyr i'r cyflwyn ydych chi'n gwneud. Mae'r cyflwyn yn ymwyr i'r cyflwyn y cyflwyn y cyflwyn y cyflwyn ydych chi'n gwneud. Mae'r cyflwyn ydych chi'n gwneud. I agree. Yes, I do. I mean, honestly, I wouldn't be doing it. If I just thought, oh, God, we're going to just, we're just going to write a couple of reports and that'll be very interesting. We'll be able to meet the recovery standard of law, but I'm not interested in that. I don't need that. So what I'm doing and just to prove the change not only is going to happen, but already is happening. As I'm going around the country, doing a lot of visits to a lot less, particularly areas where this problem is concentrated everywhere I'm going. I'm saying to the local leaders, well, that's a mayor, council leader, MP, employers, college. Guys, what are you going to do about it? Because don't wait for my review and my report. You can do something about it. I was in Bradford, as I said, the other week, they used to have amongst the worst neat rate for 16 to 17-year-olds in the country. They've really focused on it. Identified who each of these kids are. What is it that should be done to help them, etc. And now they're in the, I think they're in the second quarter or something. They're sort of really raised their performance. Everywhere I'm going, I'm saying, get behind this issue, but more importantly, form a little task force in the area of the key decision-makers, including the employers and work out what you're going to do about it. Let yourself an objective, I don't know, reduce the neat rate by third in your area in three years. It's entirely doable. That doesn't need any public policy change suggested by me. That just needs you guys coming together, working out who these kids are. What on earth needs to be done? Make it very personal to them. Get going on this now. And honestly, this is beginning to happen all over the country. And so by the time I report, I really want to feel like there's a movement behind this. I'll give you another example. I had a brilliant session with the Newcastle United, which just happens. I'm a Newcastle supporter. As you know, with the foundation. I know what that is. Oh, no, no, no. Trading into dangerous territory. With the foundation, which is just a brilliant charity. And has got reach into parts of Newcastle. No statutory organisation will ever have. Because so it's brand, right? It's got brand value. And so we're talking to the Premier League about, okay, how can we make sure that every single foundation of every single preberleeker, but also the ones who are in the Premier League, that they're sort of investing in this, making it a real issue, using their brand power to help these young kids and them to cajol persuade employers to help with this. Yeah. I'm going to happen all over the country. So that's going on now. That's not happening now. Yeah, that's so true. Because I know it with the Middlesbrough Football Club. The Middlesbrough, yeah. They've got an amazing foundation. Absolutely. You know, the thing they do things like do parents evenings in the football club to give that incentive as well to parents who might be disengaged with their education system, you know, a chance to go and see the football club as well. And I mean, you shouldn't need to do that, but that's where we are with things at the moment. There's just one other thing I wanted to ask you about before we wrap things up. He had Mark Warner on the show recently, who is the founder of Faculty AI. So, you know, this unicorn AI business set up in Britain recently bought by a censure or in the process of being for billions. And he's got a three year old and I said to him, what do you think your three year old should be learning about now? Like, it's your view changed. And this comes to your point about numeracy and literacy. As he said, AI and computers are going to do all of that. What I would be telling my three year old to do, he said, which breaks his heart as a mathematician, is not to focus on all of that, but to focus purely on creativity and communication. And all of that is the riddinger we might be out of date in our thinking about the most important things coming out of education. So I think we probably are already out of dice. You know, when you talk to employees about what is it that they really value, by and large, of course, actually they do want kids who are literally too are able to do that. But the things that they're really valuing in particular now are so called interpersonal skills. So can make eye contact. Can you have a conversation? So a friend of mine has led the movement in schools nationally to introduce what's called or receipt into the curriculum, just the ability to talk and communicate. And that's the second thing that employers say we want communication skills. We want collaboration skills because nowadays a lot of business and work generally is a team based sport. Think about what happens in healthcare, for example, it's not just about what the doctor does. It's working as part of a multidisciplinary team working together. So all of those skills become more and more important and the creativity and I put that together with agility because if you think about what's going to happen in the labour market, it's going to change very rapidly. You know, the day is gone when I was doing career, when I was getting careers advice from John Marley School in the West Ender Newcastle, I was a 16 year old. You were either I got sent to the DHS S in Long Benton and the Northern Rock in Gossuth because I was one of the brighter kids. I was on the white collar root. Most of my mates got sent to Swan Hunters or big sounds, drawings on the Scotswood road because they were blue collar and it was assumed that that would be a trajectory in life. It's not like that anymore because jobs are changing so fast. So unless we can inculcate creativity, agility, communication, collaboration together as skills in young people from the outset, we're not going to set them up. We're not even setting them up now. Know the mind what's going to happen in the future. Right, so when you say Pat McFadden and Bridget Phillips and Next, you need to say to them, get this curriculum sorted and let's get off to judge them on these things and not just on maths and English. That's what I think and all the other things that they have to do. Right, I should let you get back to your life, Alan. I wonder if it's quite funny having two Northerners who've referred to the North so often in this. I hope we haven't put off everyone who doesn't live in the North. But these are problems that aren't just Northern. They are, you know, we've used lots of examples of things we know in the North, but you know, this is not just about our area. It's about all the pockets of society and the Southwest and places where things are really tricky for the young people there. Everyone, I was down in Bristol the other day. It's not dissimilar. You know, parts of the South East, parts of London. I mean, everybody thinks, you know, everybody in the Northeast thinks London's like Boomeray but go to parts of the East, and my word, you know, these are the huge levels of deprivation, big, big, big issues. And so I think this is honestly, I think it's an issue that he's one that genuinely can unite the whole country. Everybody worries about. As a parent, as a grandparent, you always worry about the future of your kids. Yeah, yeah. Totally. That's whenever I was doing the budget coverage for the BBC, I'd often be sent to various places around the country, normally in a hardhat and hivers, so much so, someone actually set up a website, a fetish website of Steph and safety gear. But that's another story. I know, I know. But the most common thing said to me was about fuel prices and about their kids and their grandkids. Those were the feet. Always, every single year, every budget was always that was what real people were saying. Real people, you know what I mean? We say that in tele terms, but those are the two issues that came most about is how much they're paying to travel about and what's happening to their kids and grandkids. Alan, it's been great to talk to you and I really do hope this makes difference because it isn't just, this isn't just a social issue. This is about productivity, it's about economic growth. It's all of those things too. And you know, about the spending on public services and everything else. So it is one I hope that we can, we can solve. So good luck and will you come back and talk to us once all you've delivered all the information. Yeah, yeah, yeah. So between your two reports coming out so wonderful to some of them, one of the autumn, so absolutely liked it too. No, thank you for having me on again. It's been great. Thank you. Thank you very much, Alan. Right, that's it for most. Bye-bye.

Podcast Summary

Key Points:

  1. A government review is examining the crisis of 1 million young people (aged 16-24) in the UK not in education, employment, or training (NEET), described as a national emergency.
  2. NEET status is rooted in early childhood inequality; children not school-ready by age 4 are three times more likely to become NEET later.
  3. The problem has shifted from unemployment to detachment
  4. Mental health and neurodivergence (e.g., anxiety, ADHD, autism) have doubled among NEET youth, driving long-term disengagement from the labor market.
  5. The welfare system is criticized for penalizing work (e.g., losing benefits for apprenticeships) and automatically signing off young people with health issues, rather than focusing on their abilities and support needs.
  6. Schools fail to equip young people with life skills and labor market connections, while employers report youth are not work-ready.
  7. The review aims to propose solutions, including reforming welfare, education, and early intervention, with optimism due to widespread public concern.

Summary:

The transcript features an interview with Alan Milburn, leading a government review into youth unemployment and disengagement. He highlights that 1 million 16-24 year-olds in the UK are NEET, a crisis with deep roots in social inequality. The problem begins in early childhood, as children not school-ready by age 4 are far more likely to become NEET.

Crucially, the issue has shifted from unemployment to detachment: 61% of NEET youth are economically inactive, and nearly half of 24-year-olds have never held a job, leading to lifelong scarring effects and lost income. A major driver is the sharp rise in mental health conditions and neurodivergence, with health-related benefit claims doubling. Milburn argues the welfare system is broken, automatically signing off young people with diagnoses instead of asking what they can do and providing support.

Schools also fail to prepare youth for the labor market, focusing on academics over life skills. He rejects blaming young people, citing examples of youth applying to hundreds of jobs with no response. The review is exploring solutions, including welfare reform, better early intervention, and stronger employer-school links.

Despite the grim data, Milburn is optimistic because the issue has become a visceral national concern, with communities and employers eager to act to prevent a generation from being left behind.

FAQs

There are about one million young people aged 16-24 who are NEET, which is one in eight in that age group. It's described as a national emergency.

It's rooted in early social and economic inequality, starting as young as age three or four. There's also a rise in mental health and neurodivergent conditions, and the welfare system often fails to support transitions into work.

It used to affect more young women, but now more young men are NEET. Additionally, the number of young people reporting a health condition has doubled in the last 10-15 years, mostly mental health or neurodivergence.

45% of 24-year-olds who are NEET have never had a job, and they may lose up to a million pounds in lifetime income. Without a job by their mid-20s, their chances of working later in life drop significantly.

The system doesn't ask what young people can do or how to help them; it often penalizes work or apprenticeships by cutting benefits. A mental health diagnosis can lead to being signed off, trapping them in the system.

Schools often don't set young people up with life skills or connect them early enough to the labor market. The focus on academics can leave those with non-academic skills feeling worthless and disengaged.

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