London, United Kingdom. Britain will invest an additional 1 billion pounds ($1.3 billion) to help create jobs for young people, as the government seeks to reduce the nearly 1 million 16- to 24-year-olds not in education, employment or training.
The move comes after figures released last month showed youth unemployment at a 10-year high, outpacing other European nations and raising questions for the governing Labour Party over its decision to raise the minimum wage.
Funding plan and job targets
Work and pensions minister Pat McFadden said the 1 billion pounds will be invested in grants to companies willing to engage young people and in more subsidised jobs, with measures intended to help create 200,000 jobs.
“These measures will give life-changing opportunities to young people and significantly reverse the increase we inherited in those not in education, employment or training,” McFadden said in a statement.
Subsidies for hiring and apprenticeships
Businesses will receive a 3,000-pound subsidy if they hire someone aged 18-24 who has been receiving unemployment benefits for the past six months. Small and medium-sized businesses will get 2,000 pounds for each apprentice aged 16-24.
A scheme offering 25 hours a week of subsidised work to people who have been unable to find work for 18 months will be widened to include those aged up to 24.
Business response and concerns
Some companies say they struggle to afford to hire younger people, citing increases to the minimum wage alongside a rise in employers’ social security contributions and other costs.
The Recruitment and Employment Confederation welcomed the steps but said rules around apprenticeships remained too rigid and hiring costs were too high.
“It is time for more decisive action to get young people into work by making taking a chance on young people more practical for firms, from employment tax costs to the approach taken to new employment rights,” REC Chief Executive Neil Carberry said.
How do you think these subsidies will affect employers’ willingness to hire young people?
