Unemployment is liable to jump sharply in the coming months. How should FE respond to the needs of young people and adults?

Young people tend to suffer worst when there is a recession and the labour market slackens. They find themselves competing with displaced adult workers, who can demonstrate relevant work experience to prospective employers. Research shows that employers are using experience as an increasingly important filter in the recruitment process, and are also ever keener to use various forms of work trials (agency work, internships, gig work) to assess the suitability of applicants for their workplace.

Transitions from learning to earning have lengthened, and become more precarious and uncertain. In other words, a major recession runs the danger of worsening pre-existing problems with the youth labour market.

For young people not going into HE, there is the added danger that under-employed graduates will cascade further down the occupational hierarchy, taking openings that might otherwise have gone to non-graduates.

What can FE and vocational skills providers do? First, be modest in what they promise. The past, not least the recession of the early 1980s, tells us that policy debates about youth unemployment often come to blame a “lack of skills”, despite the fact that the underlying cause is a lack of job openings for new entrants to the labour market, and adult workers losing their jobs as demand for the goods and services that their organisations deliver collapses.

Most Covid-19 unemployment will not primarily be due to lack of skills

The education system runs the danger of setting itself up to fail if it promises too much by way of its ability to ameliorate the employment impacts of Covid-19. If underlying demand for labour falls and policy fails to counteract this, most of what education can do is move individuals up and down a job queue for what limited openings are available. The majority of the unemployment created by Covid-19 will not primarily be due to individuals’ lack of skills.

What can be done presents itself as a fairly predictable list. Revitalise our mechanisms for tracking young people’s labour market outcomes and those at risk of becoming NEET.

Re-think the support we can give them in terms not just of careers advice and guidance, but also wider scaffolding for transitions, and ask some hard questions about DWP and Jobcentre Plus’s ability to deliver this.

Expand traineeship provision for those most at risk of becoming NEET, and look to government (national and local) to work with employers to create pathways into work experience and then work. Wage subsidies for young employees may be needed.

For adults, when it becomes clearer in which sectors and occupations employment growth potential resides, re-training and re/upskilling schemes (often probably delivered in bitesized chunks, rather than full qualifications) will be needed.

Two key resource constraints loom. The first is the public funding. Public finances will be under huge strain in the wake of the pandemic. Tax revenues will be sharply down, spending to shore up the economy sharply up. Universities have already constructed their initial pitch to the UK government for support to tide them over the looming collapse in the overseas student market, which has cross-subsidised large amounts of activity in HE.

The second is employers’ willingness to cooperate. Before Covid-19 struck, we had ambitious targets to expand apprenticeships, expand work experience for undergraduates and many other groups of students in FE and schools, as well as find the new T-level work placements. Employers in many sectors are disorganised and lack the means to work together on skills issues; and the levels of employer-provided workforce training have been falling steadily since the late 1990s.

New collective mechanisms to engage with employers will be needed, and a new consensus about the rights, roles and responsibilities of employers will have to be constructed.