Minimum wage rise has made it difficult for employers to hire young people, says Alan Milburn
Good morning. For the second day in a row, the Westminster news is dominated by the thoughts of a leading Labour figure from the Tony Blair. But this time it’s an intervention commissioned, and welcomed, by Keir Starmer’s government. Alan Milburn, who has health secretary under Tony Blair, once seen as a future PM, and later chair of the Social Mobility Commisson, was asked last year to lead a review into why the number of young people not in education, employment or training (Neets) is rising. Today he is publishing his first “diagnostic” report, focusing on the causes of the problem. A second report, focusing on policy recommendations, is due in the autumn.
As Richard Partington reports, Milburn says Britain risks a 25% rise in the number of Neets, to 1.25 million by the early 2030s, without urgent government action to avoid a “lost generation”.
Milburn is publishing the full report, which runs to more than 200 pages and which is described by people who have read it as exceptionally thorough and hard-hitting, at a press conference this morning.
In the meantime, he has been giving interviews on the morning news shows. Inevitably, Milburn, who was a leading Blairite in the last Labour government (when the cabinet was factionally divided, and many ministers sided with Gordon Brown) was asked about his former boss’s essay published yesterday. Milburn did not get drawn into all the arguments in Blair’s essay, but he did say that he agreed with the former PM about the need to review some of the government policies that reduced the willingness of firms to hire young people.
In an interview on Times Radio, asked if he ageed with Blair that Labour had created a “climate of difficulty” for business to create entry-level jobs with an increase to the minimum wage and workers rights bill, Milburn replied:
Well, certainly every employer that we spoke to raised these issues as real concerns, the minimum wage. No employer really wants to be paying poverty wages to young people, that’s not what you come across.
But there is, particularly in low-margin sectors of the economy, like retail and hospitality, there is no doubt that these changes have had an impact. So that is something the government really needs to think about. If the priority is to create young people’s jobs, then it’s got to create the right conditions for employers to do so.
And, in an interview on the Today programme, Milburn was asked if he was willing to ask government to “think again” about the rise in employer national insurance, and the increase in the minimum wage. Milburn replied:
Yes, I am … Every employer that I talk to, they will say the same thing. There’s no doubt that the changes that were made a couple of years ago have had an impact on employers.
Here is the agenda for the day.
9.30am: The ONS publishes its latest figures on young people not in education, employment or trainining (Neets). It is also publishing figures on personal wellbeing.
11am: Alan Milburn holds a press conference to mark the publication of his report on young people and work.
Noon: John Swinney, Scotland’s first minister, takes questions from MSPs.
Afternoon: Keir Starmer is on a visit meeting apprentices in London, where he is expected to speak to broadcasters.
Afternoon: Andy Burnham, the mayor of Greater Manchester and Labour candidate in the Makerfield byelection, is expected to deliver a response to Tony Blair’s ‘Labour and the future’ essay.
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