NEETs and the labour market Labour Market Statistics User Group Conference - 20th March 2011 Paul Sissons

Outline Context Sources, methods and questions Trends in NEET Characteristics of the NEET group Geography of NEETs

Context and importance The number of NEETs has risen significantly in the past decade, and this increase began before the recession Cost of NEETs – for 16-18 NEET costs estimated at £12-£32 billion (Coles et al, 2010); individuals costs - financial and wellbeing Recession and recovery – NEET policies (Youth Contract; RPA) But, a diverse cohort – unemployed, carers, economically inactive because of illness/disability

Sources, methods and questions Cross-sectional analysis drawing on quarterly LFS datasets (2001, 2007, 2011). Quarter 1 datasets used. Flows and durations analysis using longitudinal LFSs datasets 16-24s NEET cohort Questions: What are the characteristics of the NEET cohort before and after the recession? Have the characteristics of NEETs changed over time and if so how? What can the data tell us about distance from the labour market and barriers to work?

Increasing numbers are NEET: I (Source: Labour Force Survey: Department for Education. England only)

Increasing numbers are NEET: II (Source: Labour Force Survey: Department for Education. England only)

NEET characteristics: Ages Number Rate 16 36,000 6 17 49,000 7.8 18 93,000 14.9 19-24 780,000 18.7 Total 958,000 15.9 (Source: Labour Force Survey. Department for Education. Quarter 4 2011)

NEET characteristics: Economic activity, % 2001 2007 2011 ILO unemployed 41 46 50 Inactive – looking after family/home 35 27 24 Inactive – long-term sick/disabled 6 8 TOTAL SEEKING WORK (Source: Labour Force Survey)

NEET characteristics: Health and work 20% of NEETs reported a disability in 2007 (compared to 8% of EET) Of those with a health condition in 2007: 13% cite depression (up from 6% in 2001) 11% have other mental health problems (up from 7% in 2001) 45% of NEETs had never held a paid job in 2007 (up from 39% in 2001). Estimate ~50% of NEETs are long-term (over a year) in 2006-2008 long-term calculations from 5 quarter longitudinal Labour Force Survey datasets. *Combined estimates from Q2 2006 – Q1 2008

NEET characteristics: Highest qualification - 2007 Qualifications Cohort (%) NEETs (%) Degree of equivalent 10 7 Higher education or equivalent 3 2 A-levels or equivalent 33 13 GCSE A-C or equivalent 32 GCSE A-C– x5 18 9 Other qualifications 19 No qualifications 12 27 Long-term patterns even more pronounced- used 5 quarter datasets (Source: Labour Force Survey)

NEET characteristics: Highest qualification - 2011 Qualifications NEETs (n) NEETs (%) Degree of equivalent 57,000 7 Higher education or equivalent 19,000 2 A-levels or equivalent 167,000 19 GCSE A-C or equivalent 388,000 44 GCSE A-C– x5 91,000 10 Other qualifications 86,000 No qualifications 148,000 17 (Source: Labour Force Survey)

NEET characteristics: Regional picture

NEETs by city Identified areas with high / low NEET levels in 2009 / 10

Longer-term labour market change: Occupations Main occupation: 16-24 year olds 1981 2011 Managers, Directors And Senior Officials 4% 3% Professional Occupations 11% 7% Associate Professional And Technical Occupations 2% 10% Administrative And Secretarial Occupations 26% Skilled Trades Occupations 8% Caring, Leisure And Other Service Occupations - 12% Sales And Customer Service Occupations 9% 22% Process, Plant And Machine Operatives 28% Elementary Occupations (Source: Labour Force Survey)

Summary of NEETs findings A large and growing problem Distance from labour market varies, as do barriers to work 53% are seeking work (12% not seeking but would like work) 45% have no work experience Qualifications key determinant of labour market experiences NEETs less well-qualified Pattern even more pronounced for long-term NEETs Distinct geography The labour market now: Has fewer opportunities for those with no qualifications More often requires good employability and soft skills to access entry level posts

Wider policy conclusions Better coordination of services (clear ‘pathways’) – Role for national, local gov and VS Focus on prevention Early attainment Targeted case management Grow best provision / information on what works Reflect a changing labour market Reflect a diverse cohort