Youth unemployment levels threatening to stall Midlands Engine

THE West Midlands’ growth ambitions could be thwarted unless more young people can be found employment, a new report from EY has concluded.

It said that across the region there was a huge disparity in the numbers of young people in work, with Wolverhampton identified as having one of the highest rates of youth unemployment in the country (27%), compared to Coventry which had one of the lowest rates (8.2%).

The report, prepared in association with the EY Foundation (an independent UK charity), reveals the West Midlands has a youth unemployment rate of 15.5%, higher than the UK average of 14.4%, but lower than the North East (18.3%).

In contrast, the East Midlands has one of the lowest rates in the UK at 11.7%. The East of England had the lowest rate at 11.2%.

While the variations in youth unemployment between regions are significant, they are far exceeded by those between the UK’s cities.

In every region, the majority of cities for which data is available had youth unemployment rates higher than their regional average. In the West Midlands, three of the five cities analysed had rates above the West Midlands average of 15.5%: Wolverhampton (27%), Birmingham (22.5%) and Stoke (17.3%). This compares to significantly lower rates in Solihull (11.0%) and Coventry (8.2%), the latter one of the lowest rates in the country.
 
Across the UK, the report revealed an excess in the unemployment rate for 16-24 year olds. Between March and May 2016, the rates were 28.7% for 16-17 year olds and 11.6% for 18-24 year olds.
 
Sara Fowler, senior partner at EY in the Midlands, said youth unemployment rates had fallen from the peaks seen during the recession, when 40% of the UK’s 16-17 year olds were facing unemployment.

“However, a stubbornly high number of young people remain excluded from the labour market, which could be further exacerbated by a period of weaker economic growth in a Brexit environment,” she said.
 
“Looking at the West Midlands, the region has a higher than average youth unemployment rate (15.5%), but what stands out are the wide-ranging variations in rates between the region’s biggest cities – with Wolverhampton one of the highest (27%) and Coventry one of the lowest (8.2%).

“These regional differences underline the importance of a coordinated response from Government and business to tackle the issues locally as well as nationally. This could potentially be accompanied by more devolution of skills and education to the Midlands Engine.”