New incentives need to be introduced to encourage employers to invest in younger workers who have been hit hard by the Covid-19 pandemic, the London School of Economics and Political Science has said.
This week, the Office of National Statistics revealed that 60 per cent of the total fall in employment in the past quarter was among 16- to 24-year-olds, while redundancies in the three months to October reached a new high of 370,000.
An LSE report, Trends in job-related training and policies for building future skills into the recovery, published by its Centre for Vocational Education Research (CVER), suggests that human capital tax credits should be introduced to increase the amount that firms invest in upskilling their workforce, and that the apprenticeship levy be redefined more broadly to include stronger incentives for firms to use their funds to train young people.
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The research also suggests that there should be more local control over skills policy, as local knowledge of skills gaps can help to increase the effectiveness of apprenticeships policy - and that there must be more investment in job creation and retraining schemes.
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Guglielmo Ventura, research assistant at the CVER, said: “Given the context of rising unemployment due to Covid-19, many of those who will need training might not be in employment or work with on-the-job training opportunities. Increased financial support targeted at individuals will therefore be valuable. But there is also a role for support or incentives to improve the quantity and quality of work-related training offered by firms.”
Jiaqi Li, research assistant at the LSE’s Centre for Economic Performance, said: “The analysis in our report suggests that the UK was already in need of improved policies and incentives for increased investment in workforce training. Covid-19 has made these needs all the more urgent - particularly for younger workers or those with lower levels of educational attainment.”
