‘Labour must learn the right lessons from the Milburn Review’

A great deal has already been said about the interim report of Alan Milburn’s review into the one million young people not in education, employment or training (NEETs), published last week. So brutal was the detail in which it set out the scale of the challenge facing young people trying to enter the workforce today, that the review rightly dominated the media for 48 hours and urged an immediate response from Ministers, who promptly announced 300,000 new work placements for young people.

Milburn’s final recommendations are not due until later this year. On the one hand, for the government to want to act sooner is a good sign that they take this issue seriously. But on the other, responding by announcing new work placements, part of which is an expansion of the Sector-based Work Academy Programme (SWAP), is a sign that they may have overlooked arguably the most important point made in the entire report.

READ MORE: The Milburn Review exposes a generational crisis

This point, buried at the bottom of the report in Paragraphs 666-667, is worth spelling out in full:

“Britain has not ignored youth unemployment. For more than two decades, governments have intervened repeatedly and at scale. New Deal for Young People. The Future Jobs Fund. The Work Programme. The Youth Contract. Traineeships. Kickstart. The Youth Offer.  This is not a record of passivity. It is a record of sustained policy effort. Sadly it is also a record of failure…. Despite these interventions, the structural 16-24 NEET rate has not been durably reduced. It has barely fallen below 10% in 25 years.”

The problem Milburn identifies is not government neglect. There have been repeated, energetic, well-intentioned interventions that have failed to materially shift the dial on the problem. If that is the diagnosis, then the test for the Government’s response cannot simply be whether it is big, fast, or visible, but whether it is fundamentally different to what has been tried before. On the evidence of last week’s announcement, the Government seems to have already fallen before reaching the first hurdle.

The evidence on SWAP is mixed. For every pound spent it is estimated that it saves the Treasury £1.83 within two years, and starting a SWAP has been found to increase the time that people spend in employment. This alone might be enough for SWAP to pass the “what works”test, and to appease civil servant concerns over Ministers approving an expansion.

But the government’s impact assessment of SWAP found that for every 100 people who started the programme, SWAP likely only supported an extra 13 of them to be in employment two years later and an additional 34 would have found a job anyway. This means that two years later and most people are still without work, the majority of which would have found it anyway without the programme.

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It seems to me therefore that Ministers, when presented with the evidence of Milburn’s review and asked “to do something”, may have reached for the closest lever to them. The problem is that this lever is much like the many other levers which we have pulled before and, as Milburn outlines, have not delivered any lasting, meaningful reduction in the NEET rate.

It is also worth noting that many of the 300,000 placements will be work experience, not even SWAPs. From the press release, it seems many will be focused in hospitality, health and social care, and construction. Now I am not saying these sectors cannot create excellent career opportunities for young people. For some young people, they will be the stepping stone that they need. But I am shocked that there is no mention of any of the sectors outlined in the government’s Modern Industrial Strategy – spanning the green economy, AI, life sciences, creative industries, and beyond. 

It is mad, frankly, that we are not taking this opportunity to try to place young people directly into the jobs and industries of the future. Instead, we seem to have opted for the easier option of using young people to fill gaps in the current labour market, rather than thinking more broadly about the type of economy that we are trying to build and what it is that we can do to give young people a real stake in it.

The Milburn Review is set to conclude later this year, and we should expect the government to take many of its recommendations seriously. Grasping this issue means recognising that the status quo is not passivity but repeated failure – and that the radical option is not to do more of the same at greater scale, but to build something fundamentally different.

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