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Autumn Statement: Missed opportunity to tackle youth unemployment

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Chancellor George Osborne missed an opportunity in yesterday's Autumn Statement to tackle the UK's youth unemployment crisis, the Work Foundation has said.

Despite the announcement of initiatives aimed at reducing unemployment among 16-24-year-olds, Lizzie Crowley, head of youth unemployment programmes at the Work Foundation, said "more is needed" to get young people into work.

"The chancellor's Autumn Statement has revealed that despite low business investment and a lack of export growth he has already taking the recovery for granted," said Crowley.

"While some welcome measures were announced in the Autumn Statement, much more is needed to really tackle the UK's youth unemployment crisis."

Apprenticeships and no NI

In his 50-minute speech yesterday, Osborne announced the Government would provide an extra £40 million to increase the number of people starting higher apprenticeships. Osborne said apprenticeships play a "vital role" in equipping young people with the skills they need.

"To succeed in the labour market and build a rewarding career, this Government has prioritised apprenticeships and delivered 1.5 million apprenticeship starts since 2010," he said.

In another move to tackle youth unemployment the Chancellor said from April 2015 the Government would abolish employer National Insurance contributions for those under the age of 21 to make it cheaper to hire young talent.

He also said he will not "abandon" young people who leave school with no qualifications. He said those who leave school without a GCSE in maths and English will "fail to stay off benefits".

Osborne said benefits claimants aged 18-21 without basic GCSE maths and English must enrol in a traineeship or retake the subjects in order to avoid losing benefits.

"A culture of worklessness becomes entrenched when young people go on the dole and give nothing in return, but that option is coming to an end," he added.

Immediate action

The TUC said changes to the state pension age and welfare rules mean young people have done "particularly badly" as a result of the Autumn Statement.

Its general secretary Frances O'Grady said young people would have been hoping for more than the chancellor offered.

"While it's good news that employers are to be encouraged to provide more apprenticeships and that they won't have to pay National Insurance contributions for some young people in the future, effective and immediate action is needed to tackle the youth unemployment crisis," O'Grady said.

"Unfortunately all the Government has to offer is new measures to make young people work for free, when what is really needed is a job guarantee.

The CBI welcomed the moves made by Osborne. Its director-general John Cridland said: "Abolishing a jobs tax on employing young people under 21 will make a real difference and help tackle the scourge of youth unemployment."