Time to scrap the minimum wage and useless uni courses?

Why are under-25s hardest hit by unemployment?

There's a worrying fact that often goes unnoticed when people talk about the current "record" rate of youth unemployment.
The number of 16 to 24-year-olds unable to get work has been rising almost without interruption since well before the recession.

Professor John Van Reenen, Director of the Centre for Economic Performance at the LSE, describes growing youth unemployment as "a long running problem, rather than something that has just happened".

The figures also mean under-25s make up more than a third of all unemployment in the UK.

So youth unemployment is growing to record rates and the trends would suggest that this has been going on for years rather than being a modern phenomenon.

But why? I have said for a while that the minimum wage which increases year on year is pricing young people out of work. Teenagers with no experience are often not worth the wages that employers are forced to pay for them. Older people with better experience in their chosen field can be much more productive to employers and can justify higher wages.

Also, the minimum wage which is supposed to help people afford the rising cost of living, is actually contributing to that cost. If an employer is forced to pay a set rate rather than one which reflects ability and output, they will have to recoup the extra costs by adding them on to the price of their product or service. As the cost of general products increases, so does the cost of living. This is then addressed by a further increase in the minimum wage causing a vicious circle.

If the minimum wage was scrapped, the cost of products and services would decrease, the cost of living would follow and people would be no financially worse of than they are now. With the absence of artificially inflated prices, the market would be able to dictate wages and prices and we would all be better off.

Young people would be better able to secure employment. They would have to start out on low wages, but once they had gained experience with their employers, their productivity, and therefore value in the employment market would increase and they would be earning more. Just not from the outset, which is the way it should be.

The minimum wage is not mentioned in the BBC article, although I wouldn't expect it to be. Other problems are though.

In any economic downturn, unemployment tends to rise because firms lose revenue and need to cut costs.
Despite the fact that young workers tend to be cheaper to employers, often their productivity is lower and they produce less value for the company - meaning they can be more likely to be laid-off.

That's what I was saying about the min wage. If employers could pay young people what they are actually worth there may be less need for lay offs when times are hard. If everyone was paid on their worth, young people would not be targeted specifically for termination.

Higher redundancy payments also mean it can be expensive for firms to lay off older workers.

As to redundancy payments, do employers not have funds in place to cover redundancy?

But one of the biggest alterations to the lives of young people in Britain has been the growth in the numbers going to university, a change Professor Van Reenen describes as "phenomenal".
Since 1997 the number of higher education students in the UK has risen from 1.8 million to 2.5 million, according to the Higher Education Statistics Agency.

But why are so many people going to university? We certainly are not raising a generation of young people who are far more intelligent that their predecessors, that is painfully obvious. It's all down to New Labours silly notion that everyone should have a right to further education and their targets for 50% of school leavers to do so.

In order to achieve this nonsense, university courses have been dumbed down to match the abilities of people who really have no business in further education anyway. This is taking people away from the lower paid and more manual jobs because they have been told they can go to uni and get much better jobs later. This is a complete fallacy for most of them as they don't have the academic abilities necessary.

It's a situation felt acutely by Robert Simmons, 25, who graduated with a 2:1 honours degree in Music Production from the University of Central Lancashire (UCLAN) in 2008.
He spent much of the last three years unable to find any kind of work before finally getting a job with a human resources firm, for which he says he is overqualified.

The problem is, this chap was fed the idea that he could do any old thing he wants in higher education then get a job in it at the end. He never bothered to find out how many music producers are actually required in the industry and if it was worth his while doing the degree.

He thought that after a couple of years in uni he could get a job in a recording studio for a celebrity rapper and spend his days producing nigger music and slapping ho's. Reality thought differently.

Robert says there was huge competition for even the most basic jobs during his hunt for work.
"There could be a hundred people applying, maybe ten to 15 being interviewed for every position," he explains.
"Most of the jobs I ended up applying for were unskilled jobs, basically things that you could do after a week's training in-house."

Hopefully the increase in tuition fees will help to solve this problem. If students are about to get themselves in debt, they will probably make sure they can get a half decent job at the end of their education. You would think anyway.

The bigger concern is over an apparently growing number of young people at risk of being locked out of the jobs market for good.
The argument goes that the longer young people go without gaining professional skills, the harder it becomes for them to enter the labour force.
It's something that worries William Winch, 20, from Hackney in east London who has been searching for a job since he left college in the summer.
William is now being helped by the charity Street League which helps get young people into work using football followed by professional training and support.

Yeah that'll help.


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