Agenda item

(i)              Joint Report of the Assistant Chief Executive and the Corporate Director of Children and Adults Services.

(ii)             Presentation by the Policy, Planning and Partnerships Officer, Children and Adults Services.

The Chairman thanked the Policy, Planning and Partnerships Officer, Children and Adults Services, Stephen Crass who was in attendance to give an update to Members in relation to the Youth Employment Initiative (YEI) (for copy see file of minutes).

The Policy, Planning and Partnerships Officer reminded Members of the background to the YEI, with the YEI being to “support the sustainable integration into the labour market of young people (aged 15-24) not in Education, Employment or Training (NEET)”.  Members noted that the YEI was not just to help those furthest from the labour market, but all young people from those lacking basic skills up to unemployed graduates.  It was added that County Durham was eligible for €24.0 Million (approximately £20.5 Million), which comprised of 3 elements: €9.0 Million YEI funding; €9.0 Million from the European Social Fund (ESF); and €6.0 Million of match funding.  It was explained that the funding was conditional on being committed by 2015, and with spending to be completed by 2018.

Members were given evidence relating to: unemployment rates of 16-24 year olds, noting the gap between County Durham and the North East Local Enterprise Partnership (NELEP) and National rates; the impact of recession upon young people in employment; Job Seekers Allowance (JSA) claimants aged 18-24; and the number of young people 16-18 participating in learning.  The Policy, Planning and Partnerships Officer expanded on the issue of those claiming JSA, noting there was further work required to unpick where young people were moving to after school, whether that be into employment, back into education, to be supported by their families; or to become part of the “grey economy”.  The Committee noted the “not known” figure, below that of the region, however, higher than the national figure.  

Councillors were made aware of “geographical hotspots” of youth unemployment, being: East Durham; Bishop Auckland, Shildon, Ferryhill in the South and West; and Stanley in the North of the County. 

Members also noted the groups of people overrepresented in the 16-18 NEET cohort including: pregnant/teen parents; young people with special educational needs; young people with challenging behaviour/mental health issues; care leavers; young carers; supported by the Youth Offending Service (YOS) and Looked After Children.

The Policy, Planning and Partnerships Officer noted Key Stage 4 attainment in County Durham in comparison to the figures for England, and noted that the proportion of 18 year olds entering university is lowest in the North East, however, the growth in university applicants from the North East is amongst the highest of all UK regions.

The Committee noted the cost to the economy of youth unemployment, with research estimating that the overall loss to the UK economic output in 2012 was £10.7 Billion and the cost of every young person who has been NEET over their lifetime would be £56,000 in higher public finance and £104,000 in economic terms.  Members were given a breakdown of the reasons employers gave for not employing young people, those being: lack of experience (29%); lack of skills (23%); poor attitude (18%); lack of qualifications (15%); poor quality application (13%); and “other” (2%).  It was added that consultation with young people had shown that they believed that the main barrier they faced was a lack of work experience and also the competition from older people (over 25 years of age) who have such experience. 

Councillors learned of the “Simpl Challenge”, operated by the Federation of Small Businesses (FSB) North East in partnership with the County Durham Community Foundation, County Durham Economic Partnership and Durham County Council (DCC).  It was explained that the Simpl Challenge looked for new ideas from business and the community to tackle youth unemployment in County Durham.  It was added that each Simpl Challenge was based around a question, and a “Dragons’ Den” style event would look at the best ideas, with funding available to take the best ideas forward.

Members were referred to the “Journey to Employment” and noted that the three stages were: engagement and action planning; building skills, capability and experience; and aftercare and retention.  It was explained that there were several existing programmes in place, however, it would be key for the YEI to complement those schemes and not displace those already engaged in other employability activities.  The Policy, Planning and Partnerships Officer explained that there had been several activities identified within 4 broad themes, the themes being: supporting young people’s transitions; raising aspirations for vulnerable young people; supporting young people into employment; and re-engagement activities.

The Policy, Planning and Partnerships Officer concluded by noting the next steps in terms of the YEI, included further research; defining the YEI ambition; refining activities to be commissioned; communications; determining and understanding the delivery model; commissioning; delivery; and then evaluation.

The Chairman thanked the Policy, Planning and Partnerships Officer and asked Members for their questions on the presentation.

Councillors asked several questions in relation to: the breakdown of the total funding available; the inability to direct funds towards those in full-time education that may be at risk of becoming NEET; “poor attitude” and “lack of skills” being given as reasons why employers did not employ young people.

The Policy, Planning and Partnerships Officer explained that the total funding for County Durham was £20.5 Million, with £7.7 Million being YEI funding, aligned to £7.7 Million ESF allocation with a requirement to match fund the ESF allocation with £5.1 Million.  Members noted that, initially, Government advice was that funding could be directed to those in Key Stage 4, in full-time education and being identified as being at risk of becoming NEET.  However, it was explained that recent Government guidance stated that YEI funding could only be directed towards young people who were already NEET.  The Chairman asked whether it was possible to direct other funding at those vulnerable to becoming NEET.  The Policy, Planning and Partnerships Officer explained that it may be possible to give support to those young people using ESF monies, as EU rules govern this spend.  The Policy, Planning and Partnerships Officer noted that there was further work to be done with employers locally to understand what skills they required and to educate young people on what employers actually wanted from them.

Councillors asked further questions relating to: whether “hotspot areas” received more of the resources to target youth unemployment and training; if volunteering was supported as an option to help develop young people’s skills, in the context of a lack of jobs being available post-education; low-skills churn, with lower level jobs being contracted out, preventing progression within businesses; what employers were doing to provide young people with the skills that employers want; apprenticeships and developing bespoke training to cater for niche market businesses.  

The Policy, Planning and Partnerships Officer confirmed that “hotspot areas” did receive a higher proportion of resources and though the number of NEETs in some areas were low, they represented an important proportion of young people.  It was noted that following reforms to Further Education, there was an expectation for courses to contain “proper” work experience, however funding reductions in respect of work experience, advice and guidance in schools was a result of national policy.  Members noted that young people needed the skills to be able to search, apply and interview for jobs, and be aware of their obligations once employed in order to sustain their position.    

The Committee noted that there was a stipulation that YEI funds must be targeted and there was a recognition that there were some incentives to employers to engage and Business Advisors looked to create regional links and make young people aware of the opportunities that exist.  It was explained that there were a number of good apprenticeship schemes being offered in the County, not simply graduate training programmes, and they were leading to genuine career pathways. 

Several Members noted that young people believed they were getting the skills they required from academic and vocational courses and there was a need to recognise and highlight the difference between what young people were being offered and what specialist skills local employers need.

Resolved:

(i)              That the Economy and Enterprise Overview and Scrutiny Committee note the report and presentation.

(ii)             That the Economy and Enterprise Overview and Scrutiny Committee receive a further progress report on the development of the Youth Employment Initiative within County Durham at a future meeting of the Committee.