LONDON COUNCILS – WRITTEN EVIDENCE (YUN0006)
Youth Unemployment Committee Inquiry
London Councils represents London’s 32 borough councils and the City of London. It is a cross-party organisation that works on behalf of all of its member authorities regardless of political persuasion.
Is funding for education, training and skills enough to meet the needs of young people and of the labour market? How can we ensure it continues to reach those who need it most?
It had been well known that, even before the outbreak of Covid-19, there had been performance gaps between young people based on their background, for example young people who have had experience in care generally have lower achievements and outcomes than those without such experience; and the achievement and progression rates of those entitled to free school meals are lower than those who are not entitled to free school meals. There is mounting evidence that these performance gaps have widened during the pandemic. For many disadvantaged young people, additional tuition and support - such as those funded by the government as part of its ‘catch-up’ programme – should be available as a permanent feature of the education system. There is also a growing concern that the education of children and young people whose families have no recourse to public funds is severely impacted due to long-term poverty, with local authorities facing increased demand for support.
There have been disparities in the funding system for post-16 education that are difficult to justify:
- Funding rates for 16 to 19-year-olds are lower than those for secondary schools (pre-16) and Higher Education.
- The rate for full time 18-year-old students, including those who did not achieve good grades at GCSE and who therefore need more time to achieve a level 3 qualification, are lower than for full time 16- and 17-year-olds students.
Since the start of the pandemic, it has become clear that unless these are addressed many young people who would have found it difficult to enter the labour market may now find themselves held back for far longer.
London Councils has long supported the campaign led by the Association of Colleges to equalise the funding rates paid to schools and colleges and to provide funding equivalent to £5,000 per student per year, irrespective of the type of setting and age of the student.
The discrepancies in funding have become even more critical this year as there has been an increase in the take-up of Post-16 places and more young people are expected to need three years of study at level three in courses starting this year than in previous years.
Local authorities have also expressed concern over the High Needs Funding system for some time. This includes both the system itself, which is currently being reviewed by the government, and the additional pressures it applies to local government budgets – due to an increase in both the number of young people with high needs and the severity and complexity of these needs.
We regret that the issue of funding was not covered in the FE White Paper published in January 2021.
It is also unfortunate that, even if the ambitions contained in the White Paper are realised, it will still leave funding silos that will be difficult to overcome and make it harder for young people who might need to change track in the course of their studies. It could also separate technical education and skills from other elements of business support and local planning, meaning that the possible benefits of cross-funding – maximising the returns on public investment – risk being substantially reduced.
Is careers education preparing young people with the knowledge to explore the range of opportunities available? What role does work experience play in this regard?
Prior to the outbreak of Covid-19, action had been taken to address long-standing concerns over the state of careers education in London. Careers education, information, advice and guidance had represented a critical failure that affected the functioning of our education system and contributed significantly to some of the inequities that became apparent during the lockdowns in 2020.
Some initiatives that were addressing the failures in the system had proved difficult to maintain during lockdowns and others lost some momentum. Work with employers and experiences of the world of work have been severely affected. There were, however, some activities – such as joint working between London’s councils and the Careers and Enterprise Company – that successfully adapted their delivery to match changing circumstances.
Projects that had been funded through the European Social and Investment Fund, including the Greater London Authority (GLA) Careers Cluster Programme, have now moved to be funded through the Careers Hubs initiative funded by the Careers and Enterprise Company.
In the meantime, it is possible that time in the curriculum that was previously allocated to careers education may be replaced by catch-up teaching and learning. While the motivations for this move are understandable, its effects could prove detrimental to young people’s long-term interests.
Although the main focus of educational settings is to ensure that they provide a safe learning environment and prepare for the revised arrangements for awarding qualifications in the summer, attention should still be paid to advising pupils of the most appropriate courses they should follow to reach their goals in life. With a changed and changing labour market, it is also essential that children and young people go beyond academic study and develop the transferable skills they will need to be resilient in the face of a difficult economic climate. More resources are becoming available that can be integrated into online learning.
We also advocate promotion of self-employment as an option to young people. We believe that the inclusion of enterprise and entrepreneurship into careers education, information, advice and guidance will provide young people and their parents / carers with the confidence to pursue this pathway and acquire the appropriate skills and qualifications that generate viable business opportunities and encourage success.
Once the purposes and commissioning arrangements for the UKSPF become clear, consideration should be given to prioritising projects that support improvements in the quality and availability of careers guidance, such as Careers Hubs.
London is well-placed to take forward the elements of the FE White Paper that relate to careers education, including stronger enforcement of the ‘Baker Clause’ (that is, promoting Apprenticeships to young people) and providing formal careers advice to young people in year 7.
This is consistent with the goal of demonstrating to young people and their families the equal value of technical / vocational and academic / theoretical learning routes. London Councils has advocated the concept of ‘parity of esteem’ between the different routes - including a combined, or ‘applied general route’ (which is popular in London and accounts for approximately a quarter of all post-16 provision)
London Councils, with the Greater London Authority, developed London Ambitions, a framework for schools, colleges, employers and stakeholders to develop and deliver responses and solutions to the challenges of providing skills education and training. The London Ambitions call to action will continue to be promoted.
What more needs to be done to ensure parity of esteem between vocational and academic study in the jobs market and society? How can funding play a role in this?
By way of context, at the onset of the pandemic, a body of research provided ample warning that the economic effects would be hard-hitting and require both short-term and long-term correction. Research showed that in past economic downturns, the youth labour market had been hit particularly severely and took a long time to recover (several research reports showed that the youth labour market had only just recovered from the financial crash of 2008 when Covid-19 emerged). While the measures put in place by the government have been welcome, they are time-limited and it would be both helpful and reassuring if some indication could be given of the longer-term measures that will be available to young people. The official statistics show that young people were more likely to have been made redundant or furloughed during the pandemic than the national average. Young people in the labour market are also more likely to have been employed in the industries (such as hospitality and entertainment) that will be among the last to fully reopen in the phased recovery routemap. This combination of factors affects young people severely: their confidence will have been eroded, their acquisition of job specific skills will have been disrupted, their adoption of working practices will have been disturbed.
Experience, confirmed by significant research and analysis, also shows that young people tend to react differently to turbulence in the labour market according to their age. For example, young people who are aged 16 to 18 (and who are therefore required to participate in education or training) and who may have considered entering the labour market tend to remain in full-time education or training at times of economic stress, fearing they may not be able to secure stable employment. In the case of this pandemic, that appears to have been the case; a position evidenced by many more young people than anticipated continuing in full-time Post-16 provision at the start of the academic year (some having attained better than expected grades in the summer’s GCSEs). Consequently, the proportion of 16 and 17 year-olds who were not in education, employment, or training (“NEET”) between March 2020 and March 2021 had slightly reduced (local councils have a statutory duty to ensure that there is sufficient provision for young people aged 16 to 18 to participate in education or training). Whereas those who were on an apprenticeship or in full-time employment at age 18 to 24 appear to have been badly affected by turmoil in the labour market (London experienced an almost threefold increase in the claimant count of 18 to 24 year-olds between March 2020 and March 2021, with nearly 54,000 extra young people claiming benefits).
“Parity of esteem” has been a long-stated goal of many policy makers in education, which implies that it is a long-term goal that requires consistent measures over time rather than disconnected short-term measures. The government has placed its faith in T levels, which are being phased in over the next three years. T levels are intended to be the technical and vocational equivalent of 3 A levels and have been designed in close collaboration with industry. There is a measure of cross-party support for T levels that provides greater confidence in their longevity compared with earlier attempts to develop new qualifications alongside A levels and Apprenticeships.
While funding is clearly important – and we have already commented on the need to address existing funding disparities – “parity of esteem” means building confidence among four distinct audiences:
- Students, who need to be sure that all qualifications and learning routes offer the same level of access to employment and further study.
- Parents, who need to be certain that the courses their children are following are of equal quality and value.
- Employers, who need to know what different qualifications tell them about their potential employees’ abilities, competence and character.
- Further and Higher Education Institutions, who need to be able to guide young people into further study where this is in their best interests.
The phased approach to introducing T levels means that, in the current year, the number of educational settings (schools and colleges) that are offering T levels and the number of students taking them up are very low. While there can be some judgements on their success during the build-up to their full availability, it will be difficult to reach a definitive opinion until 2024. In the interim, even though we have some concerns about the delivery framework for T levels, it is in the best interests of young people to encourage more educational settings to opt into the delivery of T levels and take part in their continuous improvement in the course of delivery.
One of the major drawbacks in the take-up of T levels is that their introduction is in parallel with the government’s programme of qualification reforms. We are concerned that exclusively funding A levels, T levels and Apprenticeships - and/or promoting them through performance measures - will limit young people’s choices as it will prevent educational settings from offering established “Applied General” and other technical qualifications such as BTECs. It will also make it even harder for students who did not achieve good grades at GCSE from achieving qualifications at levels 2 and 3 that will help them progress in work and life. This would not build the confidence of young people in the options available to them and has the potential to damage the economy, long-term, through loss of skills and talent.
Does the national curriculum equip young people with the right knowledge and skills to find secure jobs and careers? What changes may be needed to ensure this is the case in future?
The national curriculum does not in itself provide young people with the knowledge and skills to get into work and get on in work. Fewer jobs now require level 2 qualifications as an entry requirement and the national curriculum is mostly regarded as providing access to level 3 and beyond.
More critical to the employment prospects of young people is the post-16 phase. This is the time when young people make choices that affect their future – often irreversibly. Whether they pursue an academic route into university or a vocational route either through an apprenticeship or other vocational and technical study, including into professional qualifications currently outside the Qualification and Credit Framework, these choices are the greatest determinant of an individual’s long-term earnings and resilience to changes in the labour market.
Even though there are still too many young people who complete key stage 4 (usually age 16) without good GCSE grades, there is strong evidence to show that a large number of these young people attain both level 2 and level 3 qualifications by the age of 19.
Alongside the curriculum up to key stage 4, we have argued for all young people to have 100 hours experience of the world of work by the age of 16. This may include a period of formal work experience, but it could include other examples of exposure to different careers and workplace practices. This would benefit young people in two ways. First, it would help equalize opportunity. Research shows that children from disadvantaged families are likely to be less well informed of the career pathways open to them than those from wealthier families. This affects subject choices made by different students at both key stages 4 and 5 (age 18). Ensuring careers education and experience of the world of work are integrated into the curriculum would greatly assist young people in selecting the most appropriate learning pathways to help them attain good grades and fulfil their potential.
It is also relevant to note that Apprenticeship Standards do not always match the immediate development needs managers identify for their employees. This reduces the appeal of Apprenticeships, causes delays in addressing priorities for staff development and frequently leads to the provision of sub-standard learning activities. In some instances, it has also been reported that staff development needs go unmet (the number of training days delivered in the workforce has been in steady decline in recent years).
There is also evidence showing that developing character is an important element of preparing young people for entry into the labour market. Research into the employment history of young people suggests that most leavers from education (irrespective of the level of qualification they attain) will have several jobs in different industries during their lifetime and many could have their working life interspersed with periods of joblessness. Developing character prepares people for change, enables them to adapt to different workplace conditions and builds resilience so that young people can recover more quickly from adversity.
What can be done to ensure that enough apprenticeship and traineeship placements are available for young people? Is the apprenticeship levy the right way to achieve a continuing supply of opportunities?
Apprenticeships have a critical role to play in the recovery from Covid-19 and in tackling and preventing youth unemployment. As employer-led programmes that offer both on-the-job and off-the-job training, apprenticeships are uniquely placed to support employer needs and provide a pathway for young people into work.
London Councils is supportive of the principle of the apprenticeship levy. The levy ensures there is guaranteed funding for apprenticeships and provides an incentive for employers to shape the system of apprenticeship provision.
However, the apprenticeship levy is in need of reform. A survey of London’s businesses, carried out at the end of 2020, found that over half (53%) of apprenticeship levy-paying firms plan to use less than half of their levy funds over the next year.[1] It is clear that reform is needed to make it easier for employers to spend the apprenticeship levy and maximise the number of apprenticeship opportunities available, in particular for young people.
One of the major barriers to employers making full use of the apprenticeship levy has been the lack of flexibility in how the levy can be spent. At present the levy can only be spent on training costs, not on an apprentice’s wages or the administrative costs involved in hiring and supporting an apprentice. The Government should therefore consider introducing the following flexibilities:
It is also important to note that Apprenticeship Standards do not always match the immediate development needs managers identify for their employees. This reduces the appeal of Apprenticeships, causes delays in addressing priorities for staff development and frequently leads to the provision of sub-standard learning activities. In some instances, it has also been reported that staff development needs go unmet (the number of training days delivered in the workforce has been in steady decline in recent years).
Since the introduction of the apprenticeship levy, apprenticeships have increasingly been used to upskill existing employees, as well as hiring new apprentices. There is a balance to be struck between these two groups. Apprentices who are new to the workforce tend to be younger, so it is important that employers are not using the levy for existing members of staff at the expense of new and younger apprentices.
Traineeships have an important role to play in preparing young people for apprenticeships, particularly in order to create a more inclusive learning environment for young people who don’t have immediate access to apprenticeships. However, a lack of funding has hindered the development of traineeships, and therefore their impact has been limited (there were just 12,100 traineeships starts across the country in 2019/20).[2] The incentive payments for traineeships announced in the Plan for Jobs are welcome, however these are due to expire in July 2021. One solution to this lack of funding would be to allow a proportion of the apprenticeship levy to be spent on traineeships. This would ensure that more young people are ready to start an apprenticeship and would provide a vital pathway into work.
A further barrier to entry to apprenticeships is the English and maths minimum requirements. Not all young people who would benefit from an apprenticeship have achieved these minimum requirements and more needs to be done to support them to access an apprenticeship including, as noted above using apprenticeship levy funding to bolster education support in traineeships.
What economic sectors present opportunities for sustainable, quality jobs for young people? How can we ensure these opportunities are capitalised on and that skills meet demand, particularly for green jobs?
The percentage of 18-24 year old Londoners not in education, employment or training (NEET) rose from 9.7 percent in Q1 2020 to 14.9 percent in Q4 2020.[3]
Research carried out by Volterra Partners for London Councils forecasts that London’s youth unemployment rate (16-24 year olds) across London could hit 31.9% by the end of 2021 (core scenario).[4] This would be an unprecedented youth unemployment rate. The research also found that ethnic minorities will experience higher unemployment rates as result of this economic downturn, something which will be particularly pronounced in certain London sub-regions. Ethnic minorities in the Central London Forward sub-region (14.9%) and South London Partnership sub-region (13.3%) will experience substantially higher rates compared to white residents in the same geographies (6.9% and 5.3% respectively).
The research also found that the impact on employment has varied amongst different sectors. The largest declines in job postings since the emergence of COVID 19 has been in middle skill and labour-intensive occupations. Unemployment may persist for longer for residents seeking these occupations. The large numbers of unemployed younger residents expected as a result of this economic downturn represents an opportunity to reskill younger residents in the types of growth industries that are robust from automation in the future. Reskilling programmes – such as apprenticeship and internship initiatives – for this demographic should be focused on the occupations least at risk of automation and most likely to experience significant growth in the future.
The Helping Londoners Into Good Work Mission, which forms part of the London Recovery Programme, has identified four sectors that will be critical to the recovery: digital; health; social care; green economy; and creative and cultural industries. These are all likely to be key growth sectors for London in the years ahead and will therefore provide emerging job opportunities for Londoners, including young people. Film production generated £1.3 billion of inward investment spend in London in 2019.[5] Major development of new film and TV studios are planned, including a £110m studio in Barking & Dagenham, which will create 1,200 jobs and contribute £35m a year to the east London economy.
The GLA, working closely with London Councils, is proposing to establish a set of sector specific ‘skills academies’ in these areas. The academies will primarily bring together and coordinate existing provision, ensuring that provision is linked to local employer need.
London’s boroughs and subregions are already leading innovative work in these sectors. For example, West London Alliance has been working with partners to support 1,700 unemployed residents to apply for jobs in NHS mass vaccination centres.[6] Waltham Forest has partnered with local providers on the Green Energy Skills Training Alliance, which delivers training in retrofitting. Barking and Dagenham, Redbridge and Havering are exploring the possibility of creating an NHS digital champion role, working with social care, as part of their local Kickstart programme.
The green economy presents a particular opportunity for job growth. Most London boroughs have declared climate emergencies and have developed or are in the process of developing climate action plans. This work will involve developing London's low carbon sector and greening the broader economy, which over time should entail substantial job creation. Research by the LGA found that by 2050, London is forecasted to add 143,764 low-carbon jobs.[7] The green economy is made up of many disparate subsectors, some of which are in their infancy and continually evolving. As a consequence training provision is not always keeping up with skills demand, for example in air source and ground source heat pump installation. It is therefore vital that employers, providers and the public sector work closely together at local level to ensure that the right training is available to meet employer need. This is something which the sector skills academies can contribute to.
One particular challenge for the green sector is a lack of clarity over the future demand for skills. For example, retrofitting work is largely dependent upon government funding. This funding, such as the Green Homes Grant, is often of a short-term nature and it is unclear what the long-term funding picture will look like. Without this clarity, employers and providers are reluctant to invest in skills training. Greater long-term clarity is therefore needed over funding for decarbonisation schemes, so we can have greater certainty over the skills demand for the future.
6th May 2021
10
[1] London Business 1000 Survey
[2] Apprenticeships and traineeships, academic year 2019/20
[3] London Datastore, Young People Not in Employment, Education or Training
[4] A detailed study of unemployment in London