Joblessness - a human tragedy

Last week unemployment figures were published which underlined the stark reality of our country’s problem with joblessness. While Peter Mandelson has been heralding the impact of the government’s economic stimulus, unemployment rose to 2.435 million and – more worryingly – youth unemployment has climbed significantly. The statistics show that adult unemployment has risen to 7.8%, but also a 75% increase in the number of young people (i.e. aged 18-24) receiving Jobseeker’s Allowance.

The mass youth unemployment we are now seeing - according to statistics (The Guardian, 13.08.09) between 25-30% of young people in Scotland are claiming benefits – has prompted fears of a generation being locked out of employment and of a “lost generation”. And these fears are justified. Not since the days of Thatcher, when over a million young people were on the dole, has the problem been so acute. The reason for this is that in a recession companies stop recruiting staff and it is inevitably the young who are hardest hit.

Graduates and school leavers struggling to find work will exacerbate the problem, which may develop into a crisis. The fear is that many young people struggling to find work will slip into long-term unemployment at a time when Britain’s young population is at its highest for over ten years. This recession – created by the greed of the financial industry and the incompetence of Westminster – has resulted in significant job losses amongst Britain’s youth: over half the jobs lost belonged to someone aged under 24. This is not a good time to be a young person looking for work.

This increase in youth unemployment represents a human tragedy of misery, injustice and waste. I know what it is like to be made unemployed. I know what it feels like to struggle to find work. I know what it is like to be a graduate and to find that the degree I work hard for turns out to be a worthless investment. This is the real tragedy behind the latest statistics: the enforced idleness not of the “hardcore unemployed” but of bright, young people with aspirations. It is not only graduates, of course, who are suffering and young people living in already deprived areas are feeling the squeeze even more than before.

As money runs out, social problems increase. The effects of unemployment range from stress-related illness and depression to domestic abuse and increased crime. The long-term legacy of the recession may be a social rather than an economic one.

So what is the solution? Well, it won’t come from the Conservatives. The government has made some strong but unimaginative moves – including quantitative easing, devaluation, rate cuts and a generous budget which at any other time would have created a significant boost. But these aren’t ordinary times and ordinary measures are not likely to work. In fairness to Labour, the government has done a reasonable job of managing the crisis they helped to create, although it seems short on ideas to take us forward. On the other hand the Tories opposed most of the measures that have worked so far, including the nationalisation of Northern Rock, quantitative easing, devaluation and the government’s economic stimulus. Worse still, while Osbourne and Cameron were happy to jeer at the government, they were unwilling or unable to put forward any alternative solutions.

The real solution lies not with political theory but the banking industry. As the public own a large percentage of many of our commercial banks, it is only right that the banks should be lending – which is, of course, what the government bail-outs were supposed to facilitate. Lending to certain sectors, especially to small businesses, is vital to stave off unemployment. Penalties should be imposed on banks hoarding cash. Furthermore, the unrepentant attitude of excessive risk-takers within the financial industry must be reversed, and the bonus culture killed off. The Bank of England, the FSA and the commercial banks must recognise their obligations to society rather than to themselves or their shareholders. For too long, the government was unwilling to rein in those in the financial sector who disproportionately drove the country’s wealth, indulging the super-rich (yes, John Hutton, you know what I mean) and refusing to regulate.

The problem with this approach is that the culture of greed and risk-taking did not produce improved performance. It led to catastrophe. This is why change is needed.

What is also needed is an open, honest and non-partisan dialogue about wealth and its social ramifications. Sadly, this is the kind of debate that, while necessary, is something neither Labour the Tories nor the SNP want to have. They would rather score easy political points.

Bold and difficult decisions have to be made to take our country out of recession. We owe it to our young people, to our unemployed and to our communities which will inevitably feel the social effects of joblessness. It is true that unemployment is one of the last statistics to improve in a recession, but indications are that unemployment will rise further before improvements are seen. This is inescapably a human tragedy, and the recent statistics confirm John McFall’s warnings of “lasting scars” (“Act Now or face Consequences”, The Guardian, 23/3/09).

Thatcher famously adopted a laissez-faire attitude towards unemployment that appears to have been inherited by Cameron and Osbourne. Others have taken a bookish, almost nerd-like interest in the recent figures. We can’t afford to allow the human dimension to be lost or treated as a side-show to the expenses scandal. People are suffering and unless the right moves are made soon the social consequences could be enormous.

Thank God that at least Vince Cable and the Liberal Democrats understand this. Progressive change to the way the economy is managed is not only necessary but inevitable.