Young people and unskilled will bear the brunt of unemployment this autumn - but Labour council refuses to discuss it

June 29, 2020 10:34 AM

Amngst the motions which the Labour Adminstration blocked at Full Council last week was one about the importance of skills and apprenticeships - both for young people and those with inadequate skills for the future needs in an era of chage. Business organisations and others have repeatedly said that the human cost of the pandemic will be borne - perhaps for decades - by the young, the unskilled and those in the regions.

Apprenticeship Good for BusinessCouncillor Robin Ashby, who leads for the Newcastle Liberal Democrats on business and regeneration, would have said:

Unemployment is already soaring even though the furloughing scheme hasn't changed yet.

It is evident that the rate will double or treble over the rest of the year - that is several millions of our people will be without jobs for heaven knows how long.

And it is very evident from what the Chief Economist at the Bank of England, the Business Minister and business leaders have been saying on CBI webinars that the burden will fall disproportionally on the young, the unskilled and the regions.

So this motion is extremely current. Indeed, the minister said today that Government is pushing ahead in its consideration of apprenticeships schemes. So having our say now is the right thing to do at the right time to have an effect.

The region has aspirations to excel in green industries, pharmaceuticals, advanced manufacturing. But it's not the only one. The competition will be fierce from other regions and nations. So a skills pool - and equally importantly, a new culture of reskilling - will be vital.

We have existing assets. Our universities attract students and researchers from all over. But so many of them leave because they can't get jobs here. And we have had a steady trickle of talented people go away over the years - even Alan Shearer left to pursue his career elsewhere.

And our spin outs from Universities don't yet match other top universities. We have a FTSE 100 IT company in Sage - but for 40 years or more, we've rarely had more than 30 publically quoted company. We have Nissan and a supply chain of nearly 30,000. We have some specialist engineering companies.

But as the statistics in the motion show, we were short of some skills before the lockdown, and we won't have the right ones afterwards. Those who are made redundant may not be re-employed in their current sectors. When I helped create new jobs at Consett 40 years ago, we recognised with heavy hearts that we could create jobs for the wives and children of steelworkers, but a blast minder, the most talented of jobs, wasn't going to find work in a crisp factory.

So if we are to create our own new industrially advanced region - let's call it Geordie Glen - we need leadership, an entrepreneurial approach, but most importantly we need to invest heavily and quickly in people.

The full text of the motion, with supporting data on which it was based is :

Council notes :
• That even before the virus crisis, 16.8% of 16-24 year olds in the North East were not in education, employment or training - the highest proportion in England - and that numbers were rising
• Before the crisis, a third of all employers in Newcastle reported skills shortages or skills gaps, and the proportion of low skilled jobs was almost twice the English average, and 9% of the working population in the city have no qualifications at all.
• The north east has the lowest proportions of advanced and higher apprentices than any other English region, as well as the lowest level of qualifications at level 4 or higher.
• In March, unemployment in Newcastle was half as high again as for the whole of England.
• The CBI has said that "the deepest recession in living memory" will see national unemployment reach at least 9% in this quarter, that there will be a further wave of redundancies as furlough unwinds by early autumn, and that at best unemployment will reach levels no higher than the 1980s.
• The CBI also expects that the young, women, unskilled and the regions will be the worst affected
• A quarter of all small businesses expect to be out of business by the end of this year, and that a large proportion of those not failing expect to reduce headcounts. 85% of enterprises in Newcastle employ less than 10 people.
• 79% of businesses have used the job retention scheme (furloughing) which will be completely withdrawn in the autumn, by which time 42% of all businesses will have exhausted their cash reserves
• The scarring effect of unemployment for more than 6 months, particularly on the young
• The CBI says that skills are a key driver in regional inequalities
• The Government has announced that apprenticeships should be available to all, but has given no indication of how this is to be achieved
• The lack of progress so far in Brexit negotiations which make a no-deal exit at the end of the transition period an increasing risk
• The working age population of the North East has a lower qualifications profile than England as a whole with more individuals having no qualifications and fewer with high level qualifications (NVQ level 4 or above).
• The North East had a lower proportion of its residents receiving job-related training than England excluding London and most other core city LEPs, with only Greater Birmingham and Solihull having a lower proportion.
• The NE LEP has suggested that businesses looking at their supply chains to improve resilience could provide new opportunities for the North East in pharmaceutical manufacturing, automotive, and food production.
• The LEP also believes there are significant new opportunities for firms in the digital sector as more businesses look at investing in technology to enable home and remote working. There are also opportunities for cross-sectoral collaboration as businesses (e.g. in the cultural and retail sectors) plan to increase their online offer
• But that new jobs in these industries, plus "good green jobs close to home" require new and enhanced skills in the local workforce.
• Reductions in national funding have reduced the opportunities for the Council to take on apprentices and upskill employees
• JobCentre Plus has a vital role to play but has inadequate resources for the huge tasks ahead

Council therefore resolves
• To work with the North of Tyne Combined Authority, the Local Enterprise Partnership, the North East Chamber of Commerce, the regional CBI, the Federation of Small Businesses, the regional TUC and local universities and colleges to identify the region's competitive advantages and existing apprenticeships, training and reskilling capabilities
• To urge the NoTCA urgently to review, update and publish skills strategies in the light of the catastrophic impact on unemployment of the virus measures and a likely no-deal Brexit.
• To identify within its own operations areas of expertise in which it could train people in skills for the future and transferable skills, as well as refreshing existing skills
• To enhance its Connexions activities, working with its partners to identify enhanced skills training opportunities
• To write to the Prime Minister, the Chancellor of the Exchequer, Secretary of State for Business, Energy and Industrial Strategy, Secretary of State for Education, and the Minister for Apprenticeships and Skills, expressing its opinion on the urgent need for major government investment in apprenticeships, skills training, Job Centre Plus and direct support to local authorities to enable them to take on apprentices within their own organisations.