Generations betrayed by New Labour

Mass youth unemployment has returned to Britain in a way not seen since the worst days of Margaret Thatcher’s Tory government of the 1980s. The number of young people who are out of work is climbing towards two million. Nearly one in five of 16 to 24 year olds who want to work can’t find a job. Coupled with cuts in education, this means that many young people have nowhere to go. Gordon Brown’s mantra is that “training” will help people get a job. Yet even those with qualifications are spending months languishing on the dole while they try to find work. Leon left school when he was 16, but went back to study later and now has a degree. Despite his qualifications, he has only recently found temporary work after being jobless for over a year. “The system is cheating young people,” he told Socialist Worker. “Being unemployed is a painful experience. It’s disheartening.  “You work hard and study but what difference does it make? People’s skills are going to waste.” Marie graduated from Manchester university last year. “From the day I graduated I’ve been applying for jobs,” she told Socialist Worker. “But I keep getting told I don’t have enough experience. Young people are encouraged to get an education, but when you’ve finished you just feel worthless. “There are so many people applying for every job. One adviser at the Jobcentre told me that most places would need a full-time worker just to sort through all the job applications. “So a lot of the time, my application probably isn’t even read. It can really start to hit your confidence.”



In the 1980s more than one million young people were on the dole. Most working class parents didn’t expect their children to be facing the same situation today. They feel that their children have been abandoned. Joe Henry is an ex-miner living in Doncaster. He is now a teacher and sees the impact the recession is having on young people first hand. “There are strong parallels between the 1980s and today,” he told Socialist Worker. “I see kids getting qualifications but ending up on the dole. Doncaster is an unemployment blackspot.
“All the manufacturing industries and big factories have gone. Kids end up in McJobs – they are on the margins of employment. “The government says that kids need training, that unemployment is their fault rather than the fault of the system. But we educate and train kids up and there are no jobs to go to. At the college in Doncaster the bosses are laying lecturers off – at a time of mass unemployment! I left school in 1972 aged 15 and I had a choice of five different jobs to go to. Then in the late 1970s unemployment started to rise. For people like me, who had grown up with the idea of ‘cradle to the grave’ welfare state, it was a shock. When we in the pits went on strike in 1984, we weren’t just fighting for our jobs. We were fighting for the right for our kids to have work in the future. The feeling was that you shouldn’t take redundancy because it wasn’t your job to give up – it was a job for your kids.”

But true to form, his new “initiative” – Backing Young Britain – will not help young people, but instead panders to business interests. It offers firms handouts to try to persuade them to employ young people on a voluntary basis, or to run “work trials”. A government fund will offer some employers a £1,000 “subsidy” if they take on young workers. Given the scale of the problem, this is unlikely make even a small dent in the unemployment figures. Brown’s scheme mirrors demands from the bosses’ CBI organisation that the government hands companies £2,500 for each extra apprentice they train. The fact that bosses think they can hold the government to ransom, and refuse to employ people unless the state pays them to, is disgusting. But it’s little wonder that they feel confident to do so. The government has bent over backwards to appease big business since the start of the crisis. New Labour has sunk billions into the banks while refusing to take control of them. It has shown that the money exists to invest directly and create jobs. But Brown won’t even step in to save existing jobs that are under threat. For many of those who lived through the recession of the 1980s, Brown’s plans will hark back to the hated “youth training schemes” that did little more than allow bosses to exploit young people as cheap labour. For young people, being out of work means more than just being poor for a while – it means they are also likely to earn lower wages in the future.

Some 928,000 18-24 year olds are unemployed – or one in five – and the number is rising. As young people find it harder to get a job, more are trying to get to university to improve their chances. Some 60,000 more students have applied to go to university this year compared to 2008. But unfortunately qualifications don’t provide immunity to the crisis. There are now a third fewer graduate jobs than a year ago. And each graduate job is in high demand, with an average of 45 people chasing each one. So the recession is forcing young people to radically change their plans for the future. The government had pledged to increase the number of university places – but as soon as the recession hit, it cut the number of places by 30,000 and reduced funding by £100 million. They need to stop bailing out capitalism and start paying attention to the people who are the future. I think we need to argue with young people about why they need to demonstrate at Labour’s conference in Brighton next month. 16 and 17 year olds don’t even get a vote. The only way we can make our voices heard is on the streets.

The government has been putting a position, ably assisted by the mainstream media, that it had somehow got rid of the problem of unemployment. But in many areas unemployment never went away. For us, the recession means we are seeing a lot of new people who are seeking support, on top of the problems we were already dealing with. Many of these people are very angry. Benefits have been eroded to the point that, if Jobseekers’ Allowance had gone up in line with average wages rather than with below-inflation increases, it would now be worth around £110 a week rather than £60. This means that it is harder to survive when unemployed today than it was under Margaret Thatcher. Every month there are fewer jobs. Between February and April last year job vacancies fell by 51,000 – or more than 10 percent – on the previous three months. But the biggest falls in vacancies took place in the financial and business services, which were down 15.5 percent. Education, health and public administration, which were 6.1 percent down. Unemployment is up for those aged 50 and older. Those aged between 50 and retirement saw a rise in unemployment of 37,000 and those above retirement age a rise of 2,000 in the first three months of the year.

The duration of unemployment is changing. The entry of so many newly unemployed people to the ranks of the jobless has led to a drop in the proportion classed as long-term unemployed. But this doesn’t mean the situation for the long-term unemployed has improved – long term unemployment is on the rise. Unemployment is a major threat facing the working class. But those who manage to keep their jobs face different attacks. More people are working part-time who would prefer to work full-time. This trend has accelerated with the onset of recession. All the main surveys on pay find a significant minority of freezes or cuts, but freezes are not the norm. Research by the TUC found a 5 percent rise for workers at Barclays Bank and 6.25 percent for bus drivers at Stagecoach in Peterborough as examples of above-inflation settlements that have been won despite the recession. Shock figures released last week showed how young people have been hit particularly hard by the recession. Nearly half of young black people in Britain are unemployed. This stark figure comes in a new report from the Institute for Public Policy Research (IPPR) think-tank. Its findings undercut the government’s celebration of the first official fall in unemployment for 18 months and its belief that racism is no longer a central cause of “disadvantage”.

Two weeks ago communities minister John Denham launched a government report, Tackling Race Inequality. It said, “Socio-economic status and poverty affect people’s chances in life regardless of race or ethnic background.” Poverty and class do indeed affect quality of life – but race adds a very real extra burden. The IPPR report looked at 60,000 households, including 7,200 young people aged between 16 and 24. It presents the more complex picture. Unemployment for young white people is high, at 20 percent. For Asians the figure rises to 31 percent and for African Caribbeans it reaches a truly staggering 48 percent. The greatest increase in youth unemployment has been among people from mixed ethnic groups.
Some 35 percent were unemployed in November last year – up from 21 percent in March 2008.
Racism is embedded in every part of society. In schools, black children are more likely to be excluded and marginalised.Sometimes discrimination is less subtle – as a recent Department for Work and Pensions survey found. It sent out almost identical job applications to a wide range of companies. Some had names suggesting the applicant was from an ethnic minority, rather than white British. Those applicants who were perceived to be white received a positive response after nine applications. Yet ethnic minority candidates had to send 16 applications before receiving a positive response. All of this makes it hard to believe the government’s claim that racism is now peripheral. It is also wrong to use the fall in official unemployment figures to claim that the recession is over.

There are still 2.46 million out of work and this is likely to rise. The number of people working part-time jumped by nearly 100,000 in the three months to November, while the number of full-time jobs fell by 113,000 over the same period. The number of workers who say they have been forced to take a part-time position after failing to find anything full-time was close to 1.3 million, a rise of almost 40 per cent on the same period last year. Some 46 percent of young women with no qualifications are unemployed. Some employers have sacked fewer staff because they (and some union leaders) have convinced workers to take pay cuts or work shorter hours. The news that unemployment has fallen by more than expected has cheered City economists, charities and union leaders. But some have warned that further job losses are inevitable in the coming months, which could be particularly hard on young people. The number of people out of work fell 7,000 to 2.458 million in the three months to November, and the claimant count dropped by 15,200 to 1.61 million. Despite claimant count unemployment falling by a total of 26,000 in November and December, I suspect that it is premature to celebrate the end of rising unemployment. This suspicion is reinforced by the fact that full-time employment still fell appreciably in the three months to November. We believe that further modest job shedding will occur in 2010. While the economy seemingly returned to growth in the fourth quarter of 2009, we suspect that the recovery will be prone to losses of momentum and that activity will not be strong enough overall in 2010 to prevent further net job losses. While we welcome the fact that the figures show that unemployment has fallen, this trend needs to continue over the coming months. The figures show that more people than ever before are working part-time and are trying to find full-time employment. For the economy to grow, this needs to be made a reality. The run-up to Christmas is a busy time for any business and many small firms, especially in the retail sector, will have taken on seasonal staff to help them through the busy Christmas period. However, small businesses need help to make these seasonal jobs into permanent jobs and the government must lend a helping hand if small firms are to really tackle the challenge of rising unemployment.

Any drop in youth unemployment is positive but it is too soon to be complacent. One in five young people are still struggling to find a job. Britain is in danger of losing a wealth of young talent if we fail to help them into work. We may be turning the corner on unemployment with a fragile recovery but those without jobs and young workers are paying a very high price for this bankers' recession. The multi-millionaire elite who run the finance sector have resumed gorging themselves with bonuses as if nothing had happened. Like the untouchable and unaccountable landed aristocratic elite before them, their grip on political power will have to be similarly ended; this must be an issue at the general election. Nothing has been put right in the economy. We have just replaced private borrowing with government borrowing. Labour is still pretending that this will all take care of itself - if only we borrow heavily until after the election. Frankly, none of the parties is really grasping the enormity of the problem. But Labour is in the greatest denial, as it needs to repudiate the whole strategy behind the Brown boom and apologise for 12 years of storing up trouble for the future. What have we learned from the worst downturn since the Great Depression? The longest recession in our history. The largest peacetime debt. The largest peacetime deficit. Borrowing half a billion pounds a week, £178 billion a year against tax receipts of £465 billion. I'm guessing that we learned Labour couldn't organise a piss-up in a brewery, never mind govern our economy properly. Am I right? Do I get a prize for that?