Apprenticeships and youth unemployment

The creation of apprenticeships has been widely cited by Coalition Government ministers as a key solution to the problem of youth unemployment in the UK. At first sight the huge rises in apprenticeship numbers announced today would seem to support this view:

However, the full story is not that simple. Channel 4’s FactCheck blog have written a brilliant piece which highlights some key concerns with the data:

What this graphic from the report shows is that most of the big rise in the total number of apprenticeships is driven by huge increases in apprenticeships going to those who are 25 or older. It is worth quoting FactCheck’s explanation in full, particularly on the implications for youth unemployment policy:

To put this in perspective, 44 per cent of people who began apprenticeships last year were aged 25 or over. Three years earlier only 23 per cent were in the oldest category.

Over-25s are now the biggest age group, and this category is growing much faster than any other.

For the first time, the 2011/12 figures show a fall in the number of 16 to 18-year-olds signing up – a 1.4 per cent drop to 129,900.

This is a worrying trend – for two reasons.

First, it suggests that apprenticeships may not be the answer to the persistent problem of youth unemployment, as the coalition has suggested in the past.

It may be significant that Vince Cable didn’t mention youth unemployment today, or joblessness at all. Instead, he talked about making up for a skills shortage in the job market.

Second, BIS research suggests that almost half of over-25s who do apprenticeships would have got the same kind of training anyway if the government had not intervened.

BIS statisticians found in a report last year that the ”deadweight” – where the state ends up paying for something that would have happened anyway – was far more marked among older apprenticeships than teenagers.

As many as 44 per cent of over-25s would have been trained anyway,  even if the government wasn’t offering to meet up to 50 per of the cost.

The implication is that employers are just shifting the cost of training to the government, meaning that millions of pounds of taxpayers’ money are effectively being wasted.

If the age profile of the average apprentice is going up, the proportion of wasted spending is probably going up too. This is not something Mr Cable enlarged upon in his interviews with the media today.”

This shows that while apprenticeships could certainly be a solution to youth unemployment, there is a (very) long way to go before that is actually the case.

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