Andy Burnham and John Healey must cut costs of doing business to tackle youth unemployment: Beckie Hart
Youth unemployment is a growing concern, not only for young people themselves but for the wider economy. It places additional strain on the welfare system, increases financial pressure on families, and delays the careers of those who could become the next generation of business leaders, innovators and entrepreneurs.
Identifying the problem is relatively straightforward. Finding the solution is much harder.
Yet any solution must begin with a simple truth: if the government is serious about reducing youth unemployment, it must be equally serious about reducing the cost of doing business.
With more than a million young people across the UK currently not in education, employment or training, it is increasingly clear that youth unemployment is not a challenge that can be solved by skills policy alone. Creating opportunities for young people ultimately depends on businesses having the confidence and capacity to recruit, train and invest.
Think about some of the industries that are hurting most right now – where margins are so small that navigating rising costs really can be the difference between keeping the lights on or closing the doors for good. Hospitality, leisure, retail – the very same sectors where young people often take the first steps in their career journey.
Across our region employers want to create jobs, apprenticeships and work experience opportunities for young people. But with the business tax burden at a record high, many firms are facing mounting cost pressures - from higher National Insurance Contributions and wage bills to rising regulatory and energy costs – leaving less headroom to invest, recruit and create opportunities for young people.
Put simply: it’s an anchor weighing on their ambitions. The CBI’s latest report, Opportunity in Every Postcode, makes a simple but important point: youth employment and economic growth go hand in hand. They are two sides of the same coin: you cannot fix one without addressing the other.
Young people need opportunities, and opportunities come from successful, growing businesses.
The CBI is calling on the government to take practical steps to boost growth and create more opportunities for the next generation. This starts with cutting employers’ National Insurance Contributions to reduce the cost of hiring and give firms greater confidence to recruit, invest and grow. The government must also ensure employment reforms are implemented in a way that protects opportunities for young people, by adopting a 52-week reference period and a low-hours threshold of no more than eight hours in rules on guaranteed hours.
Just as importantly, the government must work with employers, training providers and devolved authorities to establish a common framework for skills devolution that protects opportunities for young people. Changing the tax treatment of business investment in health and wellbeing services will also be crucial in ensuring firms are better positioned to support young people experiencing health-related barriers to work.
The Prime Minister has rightly identified youth unemployment as a national priority. With the Autumn Budget fast approaching, the government must now turn ambition into delivery by taking decisive action to lower the cost of doing business and create the right conditions for investment.
The link between growth and opportunity is clear. The real imperative is to act now. A generation of young people are waiting for opportunity and businesses across Yorkshire and the Humber want to provide it.
Beckie Hart is CBI regional director for Yorkshire & Humber