Starmer ‘youth guarantee’ will not fix fall in apprenticeships, says UK industry body

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Sir Keir Starmer’s new guarantee of work or training for all young people in England will not reverse a collapse in apprenticeships, a leading industry body has warned, as the prime minister seeks to cut labour market inactivity.

Starmer will on Tuesday present his “Get Britain Working” white paper, which will include a “youth guarantee”, promising every person between the ages of 18 and 21 the opportunity of education, training or a job.

Work and pensions secretary Liz Kendall confirmed over the weekend that young people who refused this offer would have their benefits cut.

The white paper will also set out plans to transform jobcentres into work and careers services rather than places where people manage their benefits.

Ahead of the official release on Tuesday, Starmer said the plan “tackles the biggest drivers of unemployment and inactivity and gives young people their future back through real, meaningful change instead of empty rhetoric and sticking plaster politics”.

But Peter Cheese, chief executive of the Chartered Institute of Personnel and Development, said the youth guarantee was “not sufficient to address the collapse of apprenticeships in recent years”.

“We need a broader ambition from the government to make apprenticeships a viable alternative to university for many more young people and improve vocational pathways into employment,” he added.

Cheese said he wanted Starmer go further by offering an apprenticeship guarantee to every young person under 24 — a proposal he said “nine in 10 employers” supported.

The government has pointed to figures showing that the UK is the only major economy where the rate of employment has fallen over the past five years, driven in large part by a big rise in the number of people out of work because of long-term ill health.

Almost 1.5mn people in the UK are unemployed, 9mn are economically inactive and a record 2.8mn are out of work owing to long-term sickness, according to data cited by ministers. 

The government will set out plans to overhaul the benefits system in the spring. But a report by the Resolution Foundation think-tank last week found official labour market data had given policymakers “an overly pessimistic picture” because of a sharp drop in response rates and bias in the types of people responding. 

Tuesday’s white paper, whose proposals will form the basis of future legislation, will commit £55mn to reforming jobcentres. It will also seek to reduce sickness-related inactivity by investing £125mn in eight areas across England and Wales to pay for more tailored health and skills support.

This includes funding in three “trailblazer areas” — the North East, South Yorkshire and West Yorkshire — where health and skills experts will be sent into the NHS to try to prevent people falling out of work completely owing to ill health. 

Cheese said he welcomed the plans to overhaul jobcentres but added that the government “must also consider how it can improve engagement between jobcentres and employers”, with less than one in 10 employers seeing them as an effective means of recruitment. 

Meanwhile, Kendall will on Tuesday ask Sir Charlie Mayfield, former chair of the John Lewis Partnership, to lead a review into how companies can work with the government to address economic inactivity.

Mayfield said the problem was “really complex” and that his review would learn from other countries and the experiences of smaller companies that “care for people and keep them in work”.

“Too often government and business talk past each other,” said Mayfield, who also chaired the now-closed UK Commission for Employment and Skills.

He noted that John Lewis had invested heavily in occupational health but said he would not draw directly from his time at the retailer, describing it as a “different” kind of employer.