Youth Unemployment

The latest unemployment figures, and particularly those for young people, represent a tragic waste which demands the most urgent attention. The government understands this.

To get young people - and everyone else - into work we need to get the economy growing again, which means putting fewer burdens in the way of businesses, especially small ones, and that government at European, National, and local level has to think very hard about how to reduce the burden of bureaucracy.

Abandoning the attempt to cut the government's deficit absolutely is NOT the way to help get youngsters or anyone else into work, because the immediate result if the government appeared to be going soft on deficit reduction would be that interest rates would go up. And even if that did not push Britain into the sort of crisis which Greece, and Italy have been having, it would certainly "crowd out" investment, especially by small firms, and make it harder for them to create jobs.

We also need to watch for the operation of the law of unintended consequences. One powerful story in a report on the radio today concerned the fact that the previous government was been paying colleges by results - including exam pass rates.

You wouldn't think this could be damaging, but the problem is that this has apparently created a perverse incentive to put students in for the exams with the highest pass rates - which may not be the qualifications which will most help them get a job. The suggestion was being made that in particular this was pushing students away from subjects like maths "because they are harder." (The person who made this statement also praised Michael Gove for following her recommendation to take swift action to address this.)

I know as a school governor that one of the most important targets which the previous government set schools and the current government has continued, relates to the proportion of students getting at least five good passes including English and Maths. That should avoid the problem of schools not putting people in for those subjects, though it by no means eliminates the possibility of some perverse incentives in the system.


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