Covid-19 and our young people: Don’t. Look. Down.
Oblivion is a ride in Alton Towers. It has a top speed of almost 70mph and is most famous for its 55m plunge which finishes underground. It is 22-years-old.
When it opened, it was billed as the world’s first vertical drop rollercoaster. Publicity was huge. A major TV ad campaign ran, using the slogan “Don’t. Look. Down.” (If you fancy exposing yourself to some concentrated UK-in-the-90s vibes, watch here).
Anticipation is key. Oblivion is quite peaceful when you’re strapped in, and while the cart ticks to its apex. Peaceful, even though the violent plummet is imminent, visible and unavoidable.
An estimated 21,000 Northern Irish 16- to 24-year-olds were NEET in that period. This was equivalent to 10.7% of all young people (the overall UK proportion was 10.3%).
According to NISRA, the number of young people who are NEET has been on a general downward trend over the last four years, from a peak of 39,000 in January-March 2015. Over the past year or so, the number has been fairly stable.
The next Labour Force Survey NEET figures should be out in three weeks or so. This number could be much worse – but there’s a decent chance it won’t be. Things perhaps won’t look that bad, quite yet. Nevertheless, the plunge is coming.
UK think tank the Resolution Foundation has been doing a huge amount of work about the effects of Covid-19 on the economy.
In May it published results from a survey carried out that same month looking at how the pandemic has affected workers of different ages in terms of their jobs, pay, hours and working conditions.
Work and earnings are down for all age groups. However, young people have been hardest hit.
“Previous Resolution Foundation research has shown that excluding students, young people tend to be hit hardest during downturns, and are particularly at risk in the current one as they are more likely to work in the hardest hit sectors of the economy, such as hospitality, leisure and retail.”
“Among 18-24 year olds, 35 per cent are earning less than they did before the outbreak, and 13 per cent are earning more… One in three 18-24 year olds employees have lost work, either through being furloughed (23 per cent) or losing their jobs completely (9 per cent).”
That 9% figure is bad but, considering 35% of young people are earning less than they did before lockdown, it shows how absolute measures (similar to the NEET figures) only tell part of the story.
The Resolution Foundation itself has written about the use limits of labour market figures during this time (although it still values employment rate highly, it suggests that additional factors such as the average hours worked in each week should be taken into account – and notes that average hours in the UK fell by 23% between early March and the last week in April).
Ongoing labour force stats will be boosted by major statutory schemes, such as furlough support for businesses, and the fact that the wider consequences of Covid-19 are simply yet to take hold.
GDP may have suffered a mind-blowing, record-shattering fall during lockdown but this has yet to reach where it really matters – households.
Home finances are next in the queue for the big ride.
The Resolution Foundation says the scale of the coming economic divebomb is becoming increasingly apparent and “is as big as was feared”.
In its Earnings Outlook for Q1 2020, it raises the obvious questions about what happens when the existing buttresses like the Job Retention Scheme and SEISS wind down from August. It also proposes some solutions.
“The risk is that ongoing weakness, particularly in the worst-affected sectors, translates into mass redundancies. How many is hard to gauge, although surveys of workers and firms point to a number in the region of 15 per cent. To minimise redundancies, we suggested ongoing wage subsidies in the hard-hit sectors.
“The Chancellor has opted for a one-off £1,000 ‘bonus’ for firms re-hiring furloughed workers. In keeping with our judgement of the Government’s overall response in this new phase of the crisis, we don’t think this matches the scale of the challenge, risking a worse downturn and protracted and high unemployment. Let’s hope we are wrong and the Government is right.”
Targeting areas of need seems like a good idea. This should filter through to targeting the hard-hit demographics – including those on lower wages and, of course, young people.
In short, any attempt to address the problems stemming from the pandemic needs to appreciate both the nature and the scale of those problems.
“Policy must act now to help prevent redundancies in the hard-hit sectors, to generate new jobs elsewhere in the economy and to give the unemployed people support to take up those jobs. This should involve a wage subsidy or employer National Insurance contributions cut in the hard-hit sectors, and job creation via direct public investment in social care and retrofitting.”
This might require some new thinking. Whether that is something that our political leaders – in Northern Ireland, in the UK, and in the developed world – are capable of remains an open question.
This is less of a problem for young people. Anyone who came into the world around the same time as Oblivion at Alton Towers is going to have a different perspective on society, economics and how they fit together.
The last great economic plunge was just over a decade ago. It, too, hit young people harder than most.
Today’s 16- to 24-year-olds grew up in the shadow of the financial crisis of the noughties, and now they have a crisis of their very own.
The Covid-19 pandemic is an exceptional event and, as such, one that was very difficult to predict. However, before coronavirus, some things were well known:
Western economies (and the global economy) have ongoing weaknesses; a major event, or series of events, that could expose these weaknesses is not unlikely (if nothing else, we know climate change continues); and when an economic plunge does happen, young people are the ones who will get shafted.
In the UK, in particular, there are plenty of strong arguments as to why the economy has not worked for the benefit of young people for a very long time. This flows into a downward spiral alongside other factors like a global economy that looks increasingly desiccated thanks (at least in part) to the post-1980s economic orthodoxy, and broader factors like climate change, finite resources, and Covid-19.
Research from the University of Sheffield looked at the extent to which economic crises were becoming “normalised” among young people in the UK. It found “a relatively strong sense of generational identity among today’s young people in which, rightly or wrongly, they believe their political and economic experiences are unique, or uniquely difficult, compared to recent cohorts.”
That research is from 2018. Imagine the findings today.
Political discourse is happy to talk about new ways of thinking, and of doing business, but talk is talk. Action is needed.
That might be more challenging for older generations who grew up in happier economic times and are thus more wedded to older wisdom. Younger people might be more open minded.
The labour market is ticking towards oblivion. A big plunge is unavoidable. However, both the size of that plunge and what happens afterwards are still to be decided. Plenty remains in our hands.
Don’t be afraid to look.
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