This is an abbreviated article by Liz Barclay – read the full article at Business111.com/news
Britain has a generational jobs problem, but blaming older workers would be far too easy. Experienced people remaining in employment can be good for businesses and the economy, while the real crisis is happening at the other end of the workforce. There are now 751,000 unemployed 16–24-year-olds and nearly one million young people outside employment, education or training.
Small businesses traditionally provided the first rung on the employment ladder. Increasingly, they are struggling to afford it.
WHERE HAVE THE FIRST JOBS GONE?
Pubs, cafés, shops, restaurants, salons and thousands of other small businesses have always employed inexperienced young people and taught them how to work. But employing somebody who requires training has become a more difficult commercial decision.
The minimum wage for an 18–20-year-old is now £10.85 an hour compared with £12.71 for somebody aged 21 and over. Better wages help young workers who get jobs, but narrowing that gap also changes the calculation for an employer choosing between an inexperienced young person and somebody capable of becoming productive immediately.
Government research found UK hiring was down 14% year-on-year by April, with 30 of 38 entry-level occupations experiencing falling recruitment. In a market full of applicants, employers are increasingly able to choose experience.
IS AI REMOVING THE FIRST RUNG?
AI complicates the picture further. Entry-level hiring has fallen particularly sharply in some occupations where AI is increasingly capable, including accountancy, graphic design and software engineering.
The Government rightly cautions that this doesn’t prove AI caused those falls because recruitment is weak across the wider economy too. Nevertheless, many tasks traditionally given to junior employees can now be assisted or performed by AI.
That’s potentially great for small-business productivity, but it creates a longer-term problem. If AI does the junior work, where does somebody acquire the experience needed to do the senior work?
Today’s junior employee is tomorrow’s manager. Remove enough entry-level opportunities and Britain could discover in ten years that it has created a missing generation of experienced workers.
DON’T BLAME OLDER PEOPLE
Older workers aren’t stealing young people’s jobs. Small businesses benefit enormously from retaining their experience, particularly when those employees train younger colleagues and transfer skills accumulated over decades.
The answer isn’t pushing older workers out. It’s making it easier for businesses to bring younger people in alongside them.
The Milburn Review estimates that nearly one million young people outside employment, education or training are costing Britain £125 billion a year through lost output, tax revenues and longer-term economic damage. That’s not simply a youth unemployment problem; it’s a national growth problem.
MAKE THE FIRST JOB AFFORDABLE
The Government is introducing a £2,000 incentive for small businesses employing a 16–24-year-old apprentice alongside an expanded Jobs Guarantee. That’s a recognition that if we want businesses to employ inexperienced people, the economics have to work.
Small businesses shouldn’t carry the entire cost of fixing Britain’s youth employment crisis. Society benefits when somebody gets that first job, learns skills, pays taxes and begins building a career.
Britain needs older workers and younger workers, with knowledge passing from one generation to the next. What it cannot afford is an employment system that leaves the first rung of the ladder increasingly difficult to reach.
A small business without new talent eventually becomes a business without a future. An economy that can’t give young people their first opportunity eventually runs out of people capable of taking the next one.
This is an abbreviated article by Liz Barclay – read the full article at Business111.com/news
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