£1 Billion Boost To Youth Unemployment

25 November 2011, 07:41 | Updated: 30 March 2016, 13:50

Nick Clegg is in Leeds promising to create hundreds of thousands of work placements for young people in the face of record levels of youth unemployment.

The Sheffield Hallam MP and leader of the Liberal Democrats is to announce the creation of a £1 billion Youth Contract aimed at helping jobless young people get back into work or education.

The move comes the day after official figures revealed that a record 1,163,000 16 to 24-year-olds were ``NEET'' (not in education, employment or training) in the third quarter of this year.

The number of people in this age group who are looking for work also increased by 67,000 in the quarter to September to 1.02 million, the worst total since comparable records began in 1992.

Mr Clegg will announce that under the Youth Contract, from next April, over a three-year period at least 410,000 work places will be found for 18 to 24-year-olds.

This includes wage subsidies worth £2,275 handed to employers to take on 160,000 18 to 24-year-olds.

Each of these "wage incentives'' are worth half of the youth national minimum wage and last for six months.

They will be available for those youngsters that need the most help after three months, and all of those who have been on Jobseeker's Allowance (JSA) for nine months.

Mr Clegg will also say that the contract will offer a work experience placement of up to eight weeks for every unemployed 18 to 24-year-old that wants one.

Extra funding for apprenticeships and a #50 million programme to help persistently NEET 16 and 17-year-olds will also be on offer, the Government said.

Mr Clegg will warn that young people who fail to sign up to the Youth Contract will be considered for "mandatory work activity'', while those that drop out of work experience or jobs without good reason will lose their benefits.

Launching the initiative at a college in Leeds today, Mr Clegg will say: "The aim of the Youth Contract is to get every unemployed young person working or learning again before long-term damage is done.

"This is a #1 billion package and what's different about it is it gets young people into proper, lasting jobs in the private sector.

"But it's a contract, a two-way street: if you sign up for the job, there'll be no signing on for the dole. You have to stick with it.''

Youth unemployment is an "economic waste and a slow burn social disaster'', Mr Clegg will say.

"We can't lose the skills and talent of our young people - right when we need them most. We can't afford to leave our young men and women on the scrap heap.''

Dr Adam Marshall, director of policy at the British Chambers of Commerce, said: "The Government has to make it easier for businesses to hire young people. Employers often spend a large amount of time and money training up those young people not in education, employment or training.

"The proposal to pay employers half of the minimum wage payment for the first six months will help businesses offset this cost.''