Branding young unemployed people as feckless welfare scroungers is both inaccurate and counterproductive, says ERNIE JACQUES. This simplistic perspective reframes a complex macroeconomic challenge as an individual failing.
In recent times, British political discourse has become increasingly fixated on the burgeoning welfare bill. Demands to reduce it have been heard across the political spectrum but are spearheaded largely by Conservative and Reform politicians, and amplified by their supporters in the media.
While people with disabilities are often the target – as Mary Hull illustrates so well in her recent article – so too are young people not in education, employment or training, the so-called NEETs. To the right wing finger-waggers, these 16 to 24-year-old youngsters are merely playing the system, some one million of them “choosing” to live on benefits rather than seek work or prepare for employment.
This view is frequently couched in ethical terms: those receiving state support are guilty of moral turpitude, while the rise in welfare spending is down to a decline in work ethic and little else. Forcing young people off benefits and into work is, therefore, seen as essential for their individual wellbeing as well as for community development and economic prosperity.
This simplistic perspective conveniently reframes a complex macroeconomic challenge as an individual failing, deflecting scrutiny from structural problems inherent within the labour market. To many commentators, work in itself is wholly beneficial, providing dignity, self-sufficiency, and a pathway to prosperity and a good life. For many workers, it can be, but for millions it is anything but.
The harsh reality confronting all too many in today’s workforce is a life of low wages, precarious employment conditions and limited opportunities for advancement. When entry-level positions offer minimal financial security, seeking alternative survival strategies becomes a rational, economic response rather than a gesture of inertia or laziness.
As the old saying goes, “fine words butter no parsnips”. Political imperatives, in other words, cannot disguise or overcome the poor wages and conditions that make some employment unfulfilling and unaffordable. When work fails to provide opportunity or fair pay, many workers simply disengage. As citizens of the old Soviet Union used to say, “They pretend to pay us, and we pretend to work.”
Resolving this problem requires structural improvements to wage levels, job quality and workplace opportunities, rather than moves to punish people who are responding rationally to a lack of incentives.
Amid all the noise surrounding fiscal sustainability, until recently there has been remarkably little political acknowledgement of the root causes of the NEETS problem, driven as it is by decades of wage stagnation, systemic job insecurity and an escalating housing affordability crisis. When full-time employment no longer guarantees financial independence or a path towards long-term security, the foundational social contract unravels.
Structural causes
The current Labour government under Andy Burnham has committed to reforming the system, guided by former MP Alan Milburn’s independent review of young people and work, which was commissioned under Starmer. Milburn’s interim report on the underlying extent and causes of the issue, published in May, presents a damning picture of political failure, of a society that has repeatedly let young people down, creating “a lost generation” who are not only economically inactive but sometimes not even looking for work.
Milburn describes this as “a moral crisis” that “has economic consequences”. “We cannot complain about labour shortages, low growth, rising welfare costs and pressure on public services while allowing the talent of nearly one million young people to go to waste,” he writes.
His review, he says, “unashamedly extols the virtues of work”. “Not any work, at any price, under any conditions,” he adds. “But good work. Work that gives structure to the day, purpose to the week, confidence to the person and contribution to the country. Work is not only about income, although income matters. It is about connection. It is about self-respect. It is about independence.”
Significantly, the report identifies the causes of the NEETs crisis as structural, endemic to the state systems young people rely on and to the labour market they have to negotiate.
“It is obvious from this assessment that reform is long overdue,” Milburn says. “In education, skills, health and welfare. There is much focus on the latter, but welfare reform without wider state reform will not deliver the goods for this generation. The same is true for labour market reform. A whole system reset is needed.
“The conclusion I have reached is stark,” he adds. “The education system produces qualifications but does not guarantee transitions. The health system is configured for treatment, not participation. The welfare system replaces income but does not build pathways.”
While Milburn’s final proposals are not due until later this year, the government has already introduced some key labour market “reset” measures designed to help working people as a whole, including the Employment Rights Act, which aims to ban exploitative practices such as fire and rehire, and an increase in the national living wage to £12.71 per hour.
Plans are also underway to establish fair pay agreements in adult social care, ensuring standardised pay and employment conditions. Zero-hour contracts and one-sided flexibility clauses are set to be banned.
New protections
Although proposals are somewhat vague in places, self-employed workers are also due to enjoy new protections, such as the right to a written contract, stronger health and safety measures, protection against late payments, an end to blacklisting practices, and protection for whistleblowers.
In addition, Labour’s New Deal for Working People will grant basic employment rights from day one, such as statutory sick pay, paternity leave, and eligibility for increases to the national minimum wage.
These are positive changes from central government. And there are welcome moves at local level, too. For example, 60 UK local authorities currently pay the real living wage (higher than the NLW). The majority of these are Labour-led, with 79% in London where the rate is £14.80 per hour.
City of York council – along with authorities in Newcastle, Gateshead, Leeds and Calderdale (the latter Reform-led since the May local elections) – pay the outside London rate of £13.45 to directly employed staff. York also actively promotes the real living wage among subcontractors through its procurement and social value policies.
However, these 60 councils make up only 15.7% of the 382 UK local authorities, while Labour controls 125 councils in all, meaning more than half of Labour-led local authorities have yet to implement the enhanced pay rates.
What’s more, Labour’s 1,000-day schedule for implementing the New Deal changes (roughly 2.75 calendar years) is puzzling. Such a delay offers hostile employers ample opportunity to circumvent fixed-contract requirements. Already, the commitment to an outright ban on fire and rehire has been watered down, with companies pleading financial necessity to avoid insolvency.
The proposed ban on zero-hour contracts has similarly been diluted, shifting from an immediate day-one ban to a six-month qualifying period. While this is an improvement over the previous 24-month waiting time, it remains a significant compromise. Not surprisingly, trade unions and many Labour MPs are dissatisfied with this less robust version of its manifesto commitments.
Some employers have already begun taking advantage of these loop holes. In Scotland, for example, the SNP-led Glasgow City Council threatened to fire and rehire 23,000 employees. Although fierce opposition from trade unions and the public has temporarily halted the threat, the dispute over proposed pay cuts for 11% of its workforce (5,530 employees) remains unresolved.
Systemic change
Labour’s employment reforms will doubtless benefit young workers too, and those seeking work. But as Milburn’s report makes clear, tackling the NEETs crisis will require far more long-term, specific and systemic change.
Meanwhile, the tendency to characterise young unemployed people as feckless and largely responsible for escalating welfare costs will no doubt continue, although it is both inaccurate and counterproductive. Such narratives obscure the true causes of rising expenditure, namely a growing and elderly population and a sharp upturn in disability claims following the pandemic, when the Department for Work and Pensions (DWP) permitted self-certification.
Indeed, popular rhetoric concerning “welfare dependency” misrepresents the balance of state spending. The vast majority of the welfare budget is absorbed by state pensions and in-work subsidies such as Universal Credit. Far from funding idleness, these in-work benefits effectively function as public subsidies for low-wage businesses, transferring the cost of wage suppression from private employers to the public purse.
Until labour market policy directly targets stagnant pay, housing costs and job insecurity, punitive welfare reforms will neither improve workforce engagement nor achieve fiscal balance.
While Labour has yet to define its approach to NEETs, the populist alternatives are already becoming clear. Reform UK, for example, wants to reduce the welfare bill by forcing people who’ve been unemployed for more than a year, and are able to work, to do 20 hours of community service per week. This would include cleaning streets, maintaining parks, performing minor repairs in public spaces, and assisting in local libraries and community centres. Those who refuse would lose benefits.
On the face of it, such a proposal will likely gain traction among many voters – not just Reform and Conservative voters, but some Labour supporters too. In reality, the substantial costs of implementing such a scheme are likely to outweigh any potential savings – not just financially, but by causing social division and widespread unhappiness.
Hopefully, the upcoming Milburn proposals will avoid such punitive and unworkable solutions. Instead, it needs to suggest constructive ways to identify the essential skills the country needs, and establish clear training and placement routes for young people into secure, well-paid employment.
Effective training and employment pathways do offer real long-term benefits to young people, families and communities. Putting those in place will require huge upfront investment, meaning net savings in the early years will be minimal or none existent. In the longer term, however, the benefits of progressive, focused reforms could be huge – socially, economically, and politically.
As Milburn’s “diagnostic” report concludes: “This is a generational challenge. Our country’s future rests on the next generation. We all have a responsibility to ensure they are set up to succeed. Young people have not given up on work. We must not give up on them.”
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Ernie Jacques is a retired mechanical engineer, trade unionist and local government officer who lives in a York. He describes himself as “a long-term supporter of the ILP and a dedicated left-wing socialist”.
See also: ‘Why Welfare Reform Must Put People First’ by Mary Hull.
And: ‘Labour in Crisis: The Moral Reckoning of the Starmer Leadership’ by Ernie Jacques.
