United Kingdom: Working conditions of young entrants to the labour market

  • Observatory: EurWORK
  • Topic:
  • Job quality,
  • Published on: 19 December 2013



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There is limited data on the working conditions of young people entering the labour market in the UK. What is clear is that young people work in sectors with higher than average levels of precarious employment and that they are almost 3 times as likely to be in temporary jobs as their older counterparts. Whilst they are more likely than other workers to join organisations that provide training, 9% of young entrants work in organisations that do not provide any training. Apprenticeships are increasing in the UK and in 89% of cases lead to a nationally recognised qualification, but concerns still exist over training quality and low pay.

Introduction

This EWCO CAR is specifically focused on the group of “young entrants to the labour market”. This group includes all young people (between 15 and 30 years old) who have recently entered into the labour market (i.e., people with a work experience shorter than 1-2 years in the labour market), with relative independence of their age and for whom work is their main and core activity. This definition excludes young people for whom studies are their main activity but who combine their studies with some remunerated activity as part of their training programmes (e.g. apprenticeships in dual systems), as well as unemployed young people, even if they are actively looking for a job (see Background note for more detailed information on the concept of young entrants to be considered in the research).

The CAR coordinating team is conscious that such as “narrow” definition of “young entrants to the labour market” can make difficult the identification and collection of relevant information on the topic. Therefore, and in the case no national information is available using this “narrow” definition, National Correspondents can use a “proxy” definition of “young entrant to the labour market” as any young person (i.e. between 15 and 30 years old) who is in employment, irrespectively of the number of years of experience that he/she has in the labour market (again, unemployed young people are excluded from the analysis).

The questionnaire focuses on the following topics:

  • General description and characterisation of the main current working conditions of young entrants to the labour market in your country in comparison to other age groups (around 700 words)

  • Identification and characterisation of existing differences in working conditions within the group of young entrants to the labour market in your country (around 600 words)

  • Evolution of working conditions of young entrants to the labour market in the last five years. Effects of the economic crisis (around 500 words)

  • Initiatives taken by national governments/social partners in order to improve employment levels and working conditions of young entrants to the labour market (around 500 words)

  • Final commentary on the main results (around 100 words)

Block 1: General description and characterisation of the main current working conditions of young entrants to the labour market in your country in comparison to other age groups

NCs are kindly requested to provide the most updated information (coming from national surveys, administrative registers or ad-hoc national research/studies) on a number of working conditions-related variables specifically related to young entrants to the labour market in comparison to other age groups. Please provide the information only for those variables where significant/important differences, either positive or negative, can be identified in relation to other age groups, stressing the causes and rationale of these differences

Keep (2012) identified that the both the quantity and quality of jobs available to young workers was problematic. He identified the key issues within the UK context for young workers:

  • Just 25% of employers employ young workers, with only 6% recruiting school leavers

  • Entry level employment is frequently of poor quality with limited training attached

  • Young workers experience high levels of casualisation including agency work, temporary contracts and part time work.

  • There is a high level of under-employment of young people in terms of both the hours that they work compared with the hours that they wish to work and also over-qualification for the roles they are employed to carry out.

  • Young workers change both jobs and careers early in their transition to work, with the average young worker changing job 3.5 times and career 2.5 times over the course of their first decade in employment.

Whilst absolute numbers of temporary jobs have declined in the UK from 8% in 1997 to around 5% in 2011 the location of these jobs, and the conditions under which workers labour remain of concern. Temporary jobs are concentrated in low skilled sections of the labour market. Young workers are disproportionately affected by temporary employment in the UK with 13.9% of young workers in temporary employment, almost triple the average for the labour market (LFS, 2011). McDonald and Shildrick (2011) identify that most insecure work is done by young workers with fewer qualifications. Whilst such temporary and insecure work does not necessarily lead to labour market exclusion, for some workers it does lead to under employment and a long term cycle of poor quality and insecure work. Mc Donald and Shildrick (2011) identify that young people leaving school at 16 and 18 often get jobs that are low paid, low skilled, low quality and temporary. Such jobs offer little access to training and generally end on an involuntary basis either by redundancy or at the end of a fixed term contract.

UKCES (2013) identifies that employer provided training is declining within the UK. It also notes that organisations that recruit young workers are less likely to provide no training than organisations that do not recruit young workers.

Vocational training is a particular concern in relation to transitions from education to work for young workers. In total fifty six percent of apprentices are under 25 (Evans, 2013). There have been several reviews of apprenticeships within the UK. Ofstead (2012) voiced concerns about the exploitation of apprentices and wide variability in the provision of training and expectations of apprentices. The Richards Review (2012) of apprenticeships identified concerns about the content and consistency of training provision. Ofstead, The Richards Review and The Holt Review have all identified the complexity of the apprenticeship system, concerns about the low pay of many apprenticeships and the lack of appropriate job opportunities following training.

The Trades Union Congress (TUC) has identified particular concerns around the conditions of interns noting that internships are often unpaid or on very low rates of pay. Whilst they accept the argument that interns are offered valuable work experience they argue that recruiting interns informally and not paying them restricts access to individuals with personal connections and those that can afford to work for free. They argue that this restricts social mobility.

Block 2: Identification and characterisation of existing differences in working conditions within the group of young entrants to the labour market in your country

NCs are kindly requested to provide the most updated information (coming from national surveys, administrative registers or ad-hoc national researches/studies) on differences of working conditions within the group of young entrants to the labour market, for a series of variables. Please provide the information only for those variables where significant/important differences, either positive or negative, can be identified, stressing the causes and rationale of these differences

2.1 Personal characteristics of young entrants

The current coalition government, and previous labour governments have focused extensively on increasing the participation rates of young people in post 16 education. This has had a detrimental impact on young people seeking employment at the age of 16 rather than continued education. The increased focus on education for 16-18 yr olds has reinforced the employer perception that 16 yr olds seeking employment are low achievers with fewer soft skills and less perseverance than their peers. This perception by employers affects the employment chances of young people in the 16-18 age range in particular.

McDonald and Shildrick (2011) found that young people from working class backgrounds experienced different transitions to the labour market compared with those form middle class backgrounds. Whilst young people from middle class backgrounds may accept temporary and part time work while they study as an intermediary stage in transition to the labour market, for working class young people temporary and part time work was the outcome rather than a part of the process. Such young workers experience a cycle of temporary and low skilled jobs which trap them in low paid and precarious work.

Within the UK the chances of young people being long term unemployed are substantially increased by a lack of qualification. A study of 120,000 applicants to university in the 2006/7 found that students that graduated from their degree programme earned more than those that did not graduate, despite the fact that 40% of graduates were working in non graduate jobs.

Purcel et al (2012) looked at university applicants from applying for university into their first job post graduation. They found that graduates’ labour market prospects were affected by the university that they attended, the course they studied and the category of degree they achieved. Gender, ethnic background and their parents’ education also had a significant impact on success within the labour market. Gender had a statistically significant impact on pay within the first job after graduation across the economy irrespective of sector, university, qualifications on entry to university, category of degree, or occupation. Male graduates earn more than female graduates in all sectors. The wage premium for men is particularly marked in legal professions where women earn around 8000GBP (€9281 on 15th February 2013) less than their male counterparts and is least marked in engineering and technology. The report also found that pay rates were higher for both male and female graduates when they worked mostly with men. The same report identified a decline in real annual earnings for graduates compared with the 1999 study. They attribute this in part to increased participation in tertiary eduaction and in part to the economic downturn which has impacted on job opportunities.

2.2 Occupational characteristics

Young workers remain concentrated in retail and sevice sector occupations. These occupations have higher levels of temporary and precarious employment.

Young workers chances or recieveing employer funded training were determined both by employer size and sector. UKCES(2012) identified that around 9% of young people entered employment where no training was provided. For young workers in micro organisations, in particular those with 2-4 employees this figure was 22%. In the construction sector it was 14%.

Around 15% of businesses offer apprenticeships. Almost half of employers only offer appreticeships to new recruits. Forty percept offer them to existing staff and new recruits with just under ten percent offering them only to existing staff. This suggests that apprenticeships provide an entry route into organisations as well as advancement paths for workers already in employment.

Whilst most apprenticeships offer nationally recognised qualifications (89%) a small minority fail to provide recognised qualifications. This means that 11% of apprentices are disadvantaged by being unable to provide evidence of the quality and rigour of their training scheme upon completion. Apprenticeships without formal qualifications exist across the economy but are more common in smaller firms.

Block 3: Evolution of working conditions of young entrants to the labour market in the last five years. Effects of the economic crisis

NCs are kindly requested to provide information on the following items: NCs are kindly requested to provide information (coming from national surveys, administrative registers or ad-hoc national researches/studies) on differences of working conditions amongst the group of young entrants to the labour market in comparison to the situation five years ago. Please provide the information only for those variables where significant/important differences, either positive or negative, can be identified, stressing the causes and rationale of these differences

Suggested extension of this section: around 500 words

3.1 Please provide information on the evolution of working conditions of young labour entrants in the last five years. Have working conditions of this group improved/deteriorated in comparison to the existing situation five years ago (before the economic crisis began)? What are the reasons for these changes

Purcel et al (2012) have identified a drop in real wages for graduates over the last 5 and 10 years. There is evidence of a drop in the use of temporary work in general through the labour market, however it is increasing amongst young workers. There has been a year on year increase in the number of young people in apprenticeships over the last 2 years.

3.2 Based on possible existing prospective studies, please provide information on the expected evolution of employment levels and working conditions of young labour market entrants in your country in the near future (coming 2-3 years)

There are no studies to suggest the expected evolution of employment levels and conditions in the UK. Apprenticeships are an increasingly important feature of the transition to work. Professional apprenticeships in areas such as accountancy and law which offer entry routes for school leavers without degree qualification are likely to become an important route to professional careers school leavers that do not wish to enter university.

Block 4: Initiatives taken by national governments/social partners in order to improve employment levels and working conditions of young entrants to the labour market

4.1 Identify main recent national measures/initiatives (1-2) put in place in your country by public authorities in order to improve employment opportunities and working conditions for young entrants to the labour market.

The coalition Conservative and Liberal Democrat government have implemented a range of active labour market policies particularly targeted at young workers. The “Youth Contract” offers employers a payment of up to £2,275 for recruiting an 18-24 year old for 16 to 29 hours a week and will run for 3 years from April 2012. The scheme has no requirements around working conditions or pay for young workers. It replaces the Future Jobs Fund (FJF) which paid £6,500 towards each job and required that employers paid the national minimum wage, provide a minimum of 25 hours per week employment and posts had to be of benefit to the local community. The Work and Pensions committee has suggested that FJF may have been “an effective way of offering supported employment to young people who faced the greatest barriers to finding work”, the youth contract, by contrast, is aimed at encouraging employers to give young workers a chance in the normal labour market (work and pensions committee second report, 2013).

In addition to schemes aimed at encouraging employers to recruit young workers the government has schemes aimed at countering the disadvantage associated with a lack of experience of work. In April 2012 the coalition government launched the Youth Contract which provides incentives for employers to recruit young workers and also to offer apprenticeships and work experience to 16 to 25 year olds claiming job seekers allowance. The impact assessment of the work experience scheme showed 28% more young people in employment 21 weeks after starting the scheme than a matched sample that did not start the scheme. Critisisms of these schemes revolve around the failure to support young people that are not claiming benefits, and criticisms of the quality of training provided on work experience placements and in sector based training academies (Bivand, 2012).

Work Programme schemes have been a key part of the coalition governments attempts to encourage individuals on benefits to move into employment. They require a period of unpaid work ranging from 4 to 26 weeks once an individual has been unemployed for over 12 months, or 9 months for young workers. These schemes have been criticised by trade unions and NGO's and were recently the subject of a successful legal challenge (Guardian, 2013). Early impact reports also show that they have no measurable success in assisting job seekers in finding work.

4.2 Identify main recent initiatives (1-2) put in place in your country by social partners (either at national, sector or company level) in order to improve working conditions amongst young entrants to the labour market.

Most measures have been put in place to increase the participation of young people in the labour market. As such it is challenging to identify examples of measures put in place to improve working conditions.

Recent research by Simms et al (2013) identified work by seafaring union Nautilus an behalf of young members. The seafaring industry has a long-standing tripartite body to oversee education, training and apprenticeships called the Merchant Navy Training Board (MNTB). It is made up of representatives from government bodies, shipping companies, maritime colleges, Nautilus and RMT. Long-standing arrangements exist as a result of tripartite negotiations which provide high quality training provision, tax advantages for companies that provided apprenticeships and, for most trainees, the provision of employment at the end of training. The high quality of training coupled with a skills shortage in the industry means that most graduates find employment shortly after graduation. The union has also been sensitive to the working conditions of young members. Young and women members within the union identified that bullying and harassment at work was a particular concern. As such the union has ensured implementing effective bullying and harassment policies has spread through the bargaining agenda. This has increased the number of companies within the industry with such policies.

UKCES (2013) identify a number of examples of employer initiatives to offer work experience, apprenticeships and routes into employment for young workers. One such initiative is offered as an example is Siemens:

Siemens operates a knowledge intensive business with particular focus on learning and development in employment. The company has been keen to engage intensively with schools and builds contact with students from primary education onwards providing students with work experience. The company education program builds every year from primary school to graduate level. Each year the company recruits 100 school leavers into their apprenticeship programme. Apprentices then make up 1/3 of entrants to the company’s graduate scheme. This offers school leavers a career progression pathway.

Commentary by the NC

Within the UK most concern for young workers revolves around their ability to enter the labour market. Government and social partner responses to the challenges young people face have focused on their ability to transition into work, rather than on the quality of the work they enter. Government responses to the lack of employment opportunities for young people have moved away from subsidised employment to financial incentives for employers to give young workers a chance within the mainstream labour market and to increase take up of apprenticeships and work experience schemes. Such incentives do not require employers to offer minimum conditions, the minimum wage or even permanent employment to young workers.

Sophie Gamwell, University of Warwick

References:

Bivand, P. (2012). Generation Lost: Youth Unemployment and the Labour Market. London: Trades Union Congress. Available at: http://www.tuc.org.uk/tucfiles/239/Generation_Lost_Touchstone_Extras_2012.pdf

Labour Force Survey 2011

Evans, J. (2013) Apprenticeship Statistics. Department for Business, Innovation and Skills. House of Commons Library: London. 6

Guardian (2013) http://www.guardian.co.uk/society/2013/mar/15/dwp-law-change-jobseekers-poundland

Keep, E. (2012). Youth Transitions, the Labour Market and Entry into Employment: Some Reflections and Questions. SKOPE Research Paper No. 108 May 2012. Available at: http://www.skope.ox.ac.uk/sites/default/files/WP108.pdf

MacDonald, R. and Shildrick, T. (2011) Poverty traps not stepping stones: young adults’ long‐term experiences of precarious work. Paper presented to ESRC Seminar Series - Young workers and precarious employment, University of Warwick.

Ofsted (2012) Apprenticeships for Young People: A Good Practice Report. Available at: http://www.ofsted.gov.uk/resources/apprenticeships-for-young-people

Richard, D. (2012) The Richard Review of Apprenticeships. London: Department of Business, Innovation and Skills. Available at: https://www.gov.uk/government/publications/the-richard-review-of-apprenticeships

Simms, Hopkins and Gamwell (2013) Skills for Sustainable Employment: Strategies to Tackle Youth Unemployment. Union Learn

UKCES (2012). Investing in Youth Employment. UK Commission for Employment and Skills. Report available at: http://www.ukces.org.uk/ourwork/investment/investing-in-youth-employment-investment

Wolf, A (2011) 'Review of Vocational Education – The Wold Report'. London

Work and Pensions Committee, Second report of session 2012-2013, Youth Unemployment and the Youth Contract, House of Commons. Chapter 5

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