Small Businesses Offered Cash to Tackle Youth Unemployment
Small businesses hiring young people are to be given cash incentives, as part of a new £1 billion package of Government measures aimed at reducing youth unemployment.
Unveiled by deputy prime minister Nick Clegg and employment minister Chris Grayling, the Youth Contract was the result of “businesses and Government working together”, according to the Department for Work and Pensions (DWP).
Key proposals include giving cash payments of up to £2,275 to businesses which take on 18- to 24-year-olds for a six-month job under the programme. The payments will start in April 2012, the DWP said.
An extra 20,000 payments of £1,500 would also be made available to firms taking on unemployed young people as apprentices, with the new funds being released next year.
Other measures include 250,000 eight-week work experience places in the private sector, for young people who have been out of work for more than three months, through the Jobcentre Plus scheme.
The DWP said the aim of the Youth Contract was to “equip young people with the skills and opportunities to gain long-term sustainable employment in the private sector”. The announcement comes in the light of joblessness figures from the Office for National Statistics last month, showing that the number of unemployed 16- to 24-year-olds has exceeded one million ― a record high.
Commenting, the Confederation of British Industry said that incentivising employers would encourage businesses “to take a chance on inexperienced young people and help tackle the scourge of youth unemployment”.
But the British Chambers of Commerce (BCC) said that skill shortages amongst young people remained a problem for many employers.
“The Youth Contract will provide a much needed jobs boost for the young, but the Government must also look at how the education system can match the needs of business,”
said John Longworth, BCC director general.
“A lot of companies are working hard to invest in young people in their local areas, but too often we hear that they are ill-equipped for the workplace.”
A spokeswoman for the DWP said that full details of the Youth Contract, including how businesses should apply for incentives, had “yet to be fleshed out”.