Claudia Toma is a consultant at Whitestone Insight.
Though Generation Z are often branded as chronic moaners, dare I say they occasionally have a point. The vast majority of us have grown up in a society that has left us feeling bereft of the opportunities to progress enjoyed by generations that came before.
Attending a recent Bright Blue conference on intergenerational opportunity, it was striking to hear Laura Trott MP, Chief Secretary to the Treasury and responsible for labour market policy and strategic planning, completely dodge a question on underemployment.
Citing figures on reduced youth unemployment rate and the increase in National Living Wage under successive Conservative governments instead, Trott (un)helpfully reinforced the question: young people may be getting jobs, but will they actually lead to a career and a livelihood worth living?
A quick run-down of the sums shows that this cycle of underemployment – people working for fewer hours or using far less of their skillset than they are otherwise able and wanting to – simply is not sustainable. Research from Universities UK found barely half (53 per cent) of university graduates were earning more than £27k within 15 months of graduation.
Even with tax cuts from the Spring Statement, take home pay for those on £27k is £22k (presuming that employees can afford not to opt-out of their workplace pension). With many of these graduates living in the capital, attracted by the higher wages available, grads are looking at an average rent of £1k per month, according to research from Spare Room.
This leaves the average grad with disposable income of £10k per year without taking into account further bills (electricity, phone, internet, et al), the rising cost of living expenses, or the average cost of commuting across London to access such jobs as are even willing to pay £27k or more.
Before that gives you a headache, spare a thought for the other half who are earning even less – but still face the same costs!
We used to be a country awash with opportunity, yet today half of our country’s university grads are able only to tread water. The era of aspiration appears to be over, and the Prime Minister has a rapidly shrinking window to change that perception before the election.
This week’s announcement to create 20,000 more apprenticeships is a welcome step in the right direction, but lacks holistic thinking.
Creating jobs and opportunities to train for highly skilled careers creates a pathway to break out of intergenerational inequality for many. Yet the cost of doing an apprenticeship remains unaffordable for those that need them most. The minimum wage for those in their first year of an apprenticeship is £5.28 per hour, equivalent to £8.2k per year, an income that cannot sustain someone without independent funds to leave home and move elsewhere .
What makes this even harder for low-income families or children in vulnerable positions (such as those in care or living with severe disabilities) is that taking on an apprenticeship is often simply not worth the cost.
Though apprenticeships may come with the benefit of better long-term prospects, longer-term career planning is still too expensive a thought to entertain for our most disadvantaged children. Even for those pursuing a career in industries which the Government have backed as offering higher wages and better career prospects, such as the green economy or life sciences, jobs are frequently location- and site-specific, yet do not come with the assistance of a maintenance loan.
Parents of those beginning their career as an apprentice are no longer entitled to Child Benefit, making a lower-skilled but better-paying job both more affordable and attractive for both their children and their wider family’s financial position.
Having said all this, the answer is much more about a vision than a spreadsheet. Young people are more than mere economic units that have the potential to contribute to our nation’s GDP or simply need budgeting lessons.
We are fortunate enough to have been brought up in one of the best countries in the world for school standards. We have the knowledge and skills base to work hard, innovate, think creatively and achieve when the opportunity is there. Despite what critics may say, we are not all in thrall to social media or damaged beyond repair post-pandemic.
Rather, young people often lack the tangible hope needed to create a culture of opportunity, one where hard work can and does lead to jobs and careers that pay.
Unless the Government, or its successors, actually focus on breaking that cycle – on promoting the creation of well paying jobs across the country for all types of young people – we risk a further generation who lack not the drive or the ambition to change our country’s fortunes, but simply the chance.
The post Claudia Toma: What young people are missing is not drive or ambition, but opportunities to build a better life appeared first on Conservative Home.
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Author: Claudia Toma
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