“Today’s labour market statistics are the usual jumble of sometimes conflicting indicators, but it is clear that unemployment is continuing its slow upward creep, with the overall rate now at 5.2%, the highest since Covid. Perhaps more concerning is the figure for young people, now above the equivalent in many European countries which used to have much higher youth unemployment than us. The figure for male 18-24 year olds has reached 17.2%, up from 13.8% a year ago. Men spend longer in the workforce, are far more likely to work full-time, and are far more likely to work in the private sector where wealth is created. So the inability of a growing proportion of young men to find work has longer-term implications for the economy as well as their personal futures.

“The government, which has contributed to this problem by sharply raising employer national insurance contributions and minimum wages and passing the Employment Rights Act, is now attempting to offset this by offering employers £3,000 to take on young people. The problem with these schemes is that they don’t achieve very much. Many of those new employees would have obtained a job anyway, some employers will take on subsidised young workers in place of older workers they would otherwise have hired, and only larger firms have the expertise to navigate the bureaucratic bumf — so large businesses are subsidised at the expense of smaller ones. Evidence suggests job displacement effects are considerable, up to 80% in some cases. It would be much better if the government permanently reversed some of the job-destroying measures it has introduced in the last eighteen months.”