Gordon Brown calls for £100-a-week wage subsidy to help hire under-25s

Gordon Brown

The former prime minister Gordon Brown has called for employers to be given a wage subsidy of £100 a week to hire workers under 25 as part of a plan to prevent youth unemployment exceeding levels seen in the 1980s.

Brown said 1.5 million young people would need help to find work over the next year, adding the government’s £2bn ”kickstart” scheme announced in the summer would not be sufficient.

The former Labour leader – and prime minister during the financial crisis of the late 2000s – said research by the employment expert Prof Paul Gregg underlined how the job losses from the Covid-19 pandemic were concentrated among the under-25s.

Brown said: “This report charts the arithmetic of deprivation and desolation as youth unemployment gets out of control and this will alarm every parent in every region and nation of Britain. Today we are dealing with a far bigger challenge than in the 1980s and it needs a UK-wide jobs summit bringing together the regions and nations with the prime minister.

“Some will say this is too difficult to organise given the current breakdown in relationships between No 10 and the regions and nations but if we do not listen to what is happening on the ground and mobilise all the resources of the whole of the UK – local and national – and work together to coordinate our response we will fail a generation of young people as surely as we did for too long in the 1980s.”

According to Gregg’s research, in the summer there were 700,000 young people in need of help to find work or training but their numbers were being swelled by 500,000 school leavers and graduates, and the under-25s losing their jobs as a result of the end of the furlough scheme or because businesses were closing in areas with local lockdowns.

In his summer mini-budget, Rishi Sunak announced a £2bn plan to finance 350,000 six-month work placements for the under-25s, saying: “Young people bear the brunt of most economic crises, but they are at particular risk this time because they work in the sectors disproportionately hit by the pandemic.

“We also know that youth unemployment has a long-term impact on jobs and wages and we don’t want to see that happen to this generation.”

Brown said the government’s scheme would not provide high-quality work experience and only help those who had been out of work for six months and were on universal credit.

The former prime minister said the elements of a plan to tackle youth unemployment should include:

  • Provision of quality work experience.
  • Training geared to new jobs, in sectors such as care, IT and logistics, jobs linked to the recovery from lab technicians and contact tracers, to care workers and teaching assistants, not training for continued unemployment.
  • Help with job searches – which Brown said were a vital element of getting into work, as demonstrated by Labour’s 2009 future jobs fund.
  • A wage subsidy for employers in the order of £100 a week for six months to take a young person on full-time.