What are the barriers to employment for young people who are not in education, employment or training (NEET) or who have experience of care? What works best to support them? In partnership with the Education Development Trust (EDT), our latest report draws conclusions from a survey of practitioners and young people to understand the barriers they face, what services are offered, and what is considered to work best in helping NEET young people – and especially care leavers – to progress into work.

More than one in ten young people in the UK between the ages of 16 and 24 are classified as not in employment, education or training (NEET), and the rate of youn

g people being NEET has not fallen below 10% over the last twenty years. We know that being NEET can have immediate negative consequences for a young person, such as decreasing levels of self-esteem, increasing the likelihood of engaging in risky behaviours such as substance misuse and criminal activities, and increasing their chances of living in poverty. While there has been much research into the factors that lead to becoming NEET, how these can be mitigated, and the impacts of being NEET, there is not the same body of evidence to inform the support provided to young people to move into and stay in education, employment and training (EET).

This study looks at what the existing research has to say and surveys young people and the practitioners who work with them on four key questions:

  • What is currently offered in terms of in-work support for young people and care leavers?
  • What are the key barriers to EET for young people and care leavers who are NEET?
  • What is currently offered to young people and care leavers in terms of entry to EET support?
  • What types of provision are most effective at dealing with the barriers young people face to EET?

Drawing out lessons for practitioners and policymakers, this study contributes to our understanding of what young people see as the issues, the support they need and what service providers are offering to some of the most vulnerable people in society.

The executive summary and full survey report ‘Entry and retention in the labour market: Narratives and solutions for NEET and care leaver employment support’ can be accessed here.

Policy and recommendations summary here.

LMB Extra | October 2022

Labour Market Statistics – Extra Update, October 2022


This briefing is an addendum to ERSA’s usual monthly Labour Market Briefing (LMB) which provides our members with the latest labour market data and policy and research updates. In particular, it provides a longer and fuller exploration of the latest labour market data and trends that is drawn from the Office of National Statistics’ (ONS) monthly update. We felt this was a good time to expand what we do on this front given the current turbulent state of Britain’s economy and jobs market. Such special statistical updates aim to go beyond the now standard employment-unemployment-economic inactivity numbers and will include an additional look at other important data which provide further and fuller context to the state of Britain’s labour market.


Employment, Unemployment, Economic Inactivity and Vacancies

Since the economy started opening up after the lockdowns of 2020 and 2021, we’ve become accustomed to a-now-famous statistical quartet made up for four things: employment, unemployment, economic inactivity, and vacancies. In August, we reported some concerning, but very slight, indications in these numbers that the labour market was shifting and starting to be dragged down by the very high cost of living/cost of doing business. On the back of the Bank of England raising interest rates in August, and predicting that the economy would enter a recession by the end of the year, it became clear by September that this shift was very real. This saw both the employment numbers slow whilst the rate of economic inactivity continued to rise. Below we present these four sets of data across a range of relevant timelines.



The actual number (rather than percentage) of full-time employees saw a drop during the latest three-month period. Part-time employees also saw a drop during the latest three-month period, despite steadily growing since 2021, yet the number of self-employed workers has gone up during the latest three-month period but remains much lower than prior to 2020.


The unemployment picture has been one of the oddities of the post-pandemic labour market as it has continued to be very low. However, as we now know very well, there is still a serious broader worklessness problem that is largely explained by the stubbornly high numbers of economically inactive citizens.

As with employment above, three sets of timelines are represented by three graphs.



The final graph above may indicate a small rise in unemployment compared to its low point in March-May. Although this must continue to be monitored, particularly with news of increases in the numbers of insolvencies and economic inactivity (below), the unemployment numbers are still historically low. The other relevant data on the unemployment front comes from unemployment by duration and the claimant count.


The first graph above represents some good news on the subject of long-term unemployment with this number now being back below where it was prior to the pandemic. We have seen a steady decline in the claimant count since 2021 although recently a very slight uptick is evident.


Economic Inactivity

As noted above, with the very high and persistent rate of economic inactivity we’ve seen since the middle of the pandemic, the alarming and pressing problem of ‘worklessness’ is now not well captured by official unemployment numbers. As we head out of a post-pandemic boom and towards an inflation-generated recession, this problematic feature of our current labour market appears to be a stubborn one.



Overlapping with this age group is the large number of people out of work due to long-term health conditions which saw a record quarterly rise and reached its highest level in at least thirty years (at 2.49 million).


The rise in those economically inactive due to long-term health conditions is particularly alarming and appears, with other shifts noted in other data, to be a particularly persistent problem. This means that as the economy enters a recession and this problem remains, employment support providers will still be needed to provide the kind of long-term support this group of people need to get back into work – a case we’ll be making going into 2023 to ministers.



The vacancies problem that emerged in 2021 has been as important to understanding the pandemic era  labour market as the economic inactivity problem above, and of course they are very much causally related.



The total number of vacancies stands at around 1.266 million, a little down on the record high of 1.3 million it reached in the three month period of March to May. This levelling off since March-May aligns with the other indicators that also indicate this period of 2022 is a likely watershed point in the timeline. There was a 34,000 drop from June to August this year, the largest fall on the quarter since the same period in 2020 at the height of pandemic-induced turbulence. This picture is complicated somewhat when the vacancy numbers are observed by the industrial sector. Those sectors with the largest falls in vacancy numbers were the information and communication industry, which was down 11,000 vacancies and the professional, scientific and technical activities industry, which was down 8,000 vacancies on the quarter. Human health and social work had the largest increase in vacancies, up by 7,000 on the quarter.



The Institute for Employment studies (IES) produced a more detailed and illustrative mapping of this sector-by-sector picture.



There has been rising concern for adult social care for many years, but became particularly acute during the pandemic and have seen many leave a sector already marked by high staff turnover. We must think of these problems in view of the other data above. To raise the most pressing and conjoined set of problems of the post-2020 labour market, this points to the relationship between the historically high rate of job vacancies and historically high economic inactivity rate . As with the NHS, adult social care impacts the broader economic inactivity problem beyond the perhaps narrow confines of this one sector. A survey run by the Association of Directors of Adult Social Services (ADASS) says that social care waiting lists have grown by 37% in less than six months. As of April, there were 542,000 people waiting for care assessments, direct payments or reviews. This is up from 396,000 in November 2021. The economics of this is simple and points to a very concerning on-going problem. This problem not only conjoins each of the employment, vacancy and economic inactivity problems we face, but one that joins both the rising health-related problems and the rising numbers of those choosing to stay out of work to look after family: if there are hundreds of thousands of people waiting for care, care payments or care reviews, the caring responsibilities will fall to family members who will not be freed up to take up work. This is a complex and multi-layered problem and one that needs expert and targeted support. Public policy needs to reflect this reality and the solutions that are available.To raise one promising example of support that should be fostered by government, we know of social enterprise and local government sector providers that target young care leavers so that they can be supported into work in the adult care sector. This, beyond simultaneously addressing pressing vacancy and economic inactivity problems, has the added benefit of offering opportunities for training and work for a very vulnerable segment of the unemployed people in between the ages 16 and 24, and in particular the highly vulnerable 16-17 year olds.  Such work can be expanded and prioritised by national policy-makers as well as coordinated by local policy-makers found in local and combined authorities.


Regional level

The ONS reported the following data for the different regions and nations of the UK. For the three months ending in August 2022, the highest employment rate estimate in the UK was in the East of England (79.1%) and the lowest was in Northern Ireland (69.9%). The largest increase in the employment rate compared with the same period last year was in Yorkshire and the Humber (1.7%) while Wales saw the largest decrease of 1.9%. Up to August 2022, the highest unemployment rate estimate was found in the West Midlands (4.7%) and the lowest was in the South West (2.7%). There were record lows reported for London (4.0%) and the North East (4.4%), while the North West (3.5%) posted a joint record low.

For the three months ending August 2022, the highest economic inactivity rate in the UK was in Northern Ireland (27.8%) and the lowest was in the East of England (18.5%); the same region that boasted the highest employment rate above. Wales saw the largest increase in the inactivity rate compared with the same period last year, up 2.6 percentage points, with Yorkshire and The Humber seeing the largest decrease of 1.1 percentage points.

The sharp drop in the employment rate in Wales and its sharp rise in economic inactivity should alarm policy-makers in Cardiff and London.


Insolvencies and Redundancies

In September, it was reported in the Guardian that Insolvencies had jumped by 43% in England and Wales. By this month, the Guardian reported a further rise which constituted a 13-year high.  At some point, this will filter down into unemployment and/or economic inactivity numbers.


The word redundancies sends a chill down the spine of any labour market analyst not to mention, of course, the prospect therein for any employed person. As the economy creeps then lurches toward a recession, we must start to look at the redundancy level as well as those other measures above.

The March to May quarter has started to emerge as a key data point in the time series, meaning it is at this point when things started to shift south in the labour market. The same is once again true with the rate of redundancies. The below tables drawn from ONS data, and the latter 2022 focused graph in particular, point to a slight but clear shift upward.




These are of course raw numbers and not percentages, but the upward trend line is notable and should be observed as we approach 2023. To draw a broader contextual picture, we must look at this alongside insolvencies data.



Insolvencies data is being introduced here as it doesn’t feature in the updates provided by others like the IES and Learning & Work Institute and, as the economy heads towards a recession, it becomes a useful contextual device to try and understand problems such as unemployment rises, economic inactivity, claimant count numbers, and of course redundancies above. As noted above, reports of rising redundancies have appeared in the mainstream media. The ONS reports the following data:

  • Total company insolvencies in England and Wales in the second quarter of 2022 reached their highest quarterly level since July to September 2009, driven by Creditors’ Voluntary Liquidations (CVLs).
  • More than 1 in 10 UK businesses reported a moderate-to-severe risk of insolvency in August 2022.
  • During the same period, 22% of businesses said energy prices were their main concern, which is an increase from 15% in late February 2022; in firms with 10 to 49 employees, the figure was 30%.
  • In England and Wales, construction, manufacturing, accommodation and food service activities, and wholesale and retail trade industries together accounted for more than half of total business insolvencies in the first half of 2022.



This longer run time-series clearly marks out the effects of the financial crisis in 2009, the effects of the government support provisions like the furlough scheme that shielded companies from insolvencies in 2020, and the sharp rise we are now seeing in 2022.

We look to provide more assessment of these labour market trends as data is released and we learn more about our changing state of work and jobseeking in the UK. Such assessments will complement the core of ERSA’s work championing the role of the employment support sector and those public policy programmes that support this work.


Research Note | July 2022

UK Economic Policy, Inflation & Employment Support
Author: Dr Andrew Morton, Labour Market, Policy and Research Officer
Research Note | July 2022

This note will look that the emerging economic policy context within which employment support will have to operate over the next few years. Understanding an economic context marked by high inflation, the cost of living crisis that results and a labour market weighed down by very high vacancies will be important for an employment support sector. In historical terms, the economic problems we’re looking at coming out of a pandemic are also quite unusual, some of these problems however that will become more familiar as the prospects of a new recession become much more real. This will be particularly apparent as the government borrowing binge of the pandemic pushes us towards a familiar political context defined by a politics of debt reduction. As we all remember, amidst the wreckage of the 2008 financial crisis economic policy goals in the UK were framed so tightly around the need to service high levels of public debt (which rose sharply to prop up a collapsing banking sector) that nearly all other policy areas drawn into the same agenda. To reduce the cost to the public purse, employment policy, welfare policy and broader public services all suffered either direct (and huge) cuts in spending or, in the case of welfare, a concerted campaign to push unemployed people off welfare (into jobs, education or, simply, wherever).

At the moment, economic policy makers are losing sleep about inflation rather than a problem public debt, but given the level of spending and borrowing that had to be undertaken since March 2022, we should certainly expect the servicing of public debt to re-emerge as driving force economic policy. What could make the next recession even worse is if rampant inflation and its effects do not relent by the time central banks like the Bank of England, economic policy-makers and other power brokers like the bond markets decide fiscal retrenchment is a good idea once again. This prospects of this double-headed monster is very real.

This note will map these issues out but will make this point clear: the case for targeted and extensive employment support and a strong employment support sector is as critical as it has ever been. This support however requires financial as well as organisational assistance that will not helped if this double-headed monster emerges this year or next.

Economic policy-making and good employment policy

The health of the labour market – employment, productivity, wages – are clearly important to macroeconomic policy-makers. As the not-too-distant-example of the financial crisis demonstrates however, it’s not necessarily going to be top of the list of priorities. Back in 2008, it was public debt that was the driving force behind economic policy. At the moment it is inflation.

It is necessary first to note that, when we refer to ‘policy-makers’ in this context, we include not only government ministers, and the Chancellor of the Exchequer in particular, but also central bankers – and in Britain’s case the Governor and Monetary Policy Board (MPC) of the Bank of England (BoE). Inflation is the central concern of monetary policy, whilst taxing and spending defines fiscal policy. Although clearly connected, they do not necessarily move in tandem nor coherently. The BoE however is the entity that, in practice, interacts with the bond market to secure financing for government spending should planned spending exceed available tax receipts. With this in mind, the BoE clearly has an interest in the state of domestic fiscal policy. At the moment however, like other central banks like the European Central Bank and the Federal Reserve, the BoE is most concerned with the rate of inflation and how it can use its main policy lever– interest rates – to tackle it. The negative effect inflation has on interest paid on government debt however presents a source of BoE pressure on the Treasury and its spending plans.

Central bankers have tended adhere to orthodox macroeconomic principles identified with “sound money”, which is why when they’re given the opportunity to obsess about inflation they usually take it. This is not to say inflation is currently not a problem (it clearly is), only that as a question of emphasis this concern can lead to skewed priorities which has not historically boded well for advocates of comprehensive or ‘full’ employment policies. So in this sense, ‘sound money’ sees approaches to macroeconomic management rely on concepts that are more interested in the price level than with full employment. This produces a reliance on economic concepts such as the Philips curve and the ‘non-accelerating inflation rate of unemployment’ or ‘NAIRU’. The NAIRU operates upon the idea that there is a ‘natural rate’ of (un)employment and that policy attempts to raise employment above (and lower unemployment below) this rate will generate inflation. As a result, the dominance of devices like the NAIRU have rarely been helpful for integrating ambitious employment policy into macroeconomic policy agendas form the 1970s onwards. In tandem with restrictive inflation targeting, this was always going to affect the long-term unemployed, and those vulnerable to it the most, as it made it harder to advocate and fund policies and services to help them.

This focus on such principles has had another consequence which the pandemic era economic context has laid bare: the relationship between the employment level and vacancies. The record high number of vacancies we began to see since mid-2021 has demanded policy-makers become reacquainted with the Beveridge curve, a concept that for most of the last 50-60 years has sat in the shadow of the more famous ‘Phillips curve’. In 1989, notable macroeconomist Olivier Blanchard and colleague Peter Diamond made this point below, one which has renewed relevance now.

“macroeconomists thinking about aggregate labour market dynamics have organized their thoughts around two relations, the Phillips curve and the Beveridge curve. The Beveridge curve, the relation between unemployment and vacancies, has very much played second fiddle. We think that emphasis is wrong. The Beveridge relation comes conceptually first and contains essential information about the functioning of the labour market and the shocks that affect it.”

Blanchard and Diamond (1989) 

There is no one single ‘big lesson’ for economic management post-pandemic, but several. One of them however must be that a stubborn disconnect between employment level and high number vacancies needs targeted policy intervention and support. This will require macro-economic policy-makers in the BoE and the Treasury to see that part of the inflation problem lies in a labour market and a wage-price spiral which is already looking menacingly difficult to control (due to other factors like energy prices and the supply chain crunch).

“these issues [won’t] go away on their own, and the longer we hold off taking action to address them the greater the problems for employers, for our recovery from the pandemic, and for those out of work…So we need a new Plan for Participation, that will extend our public employment services and support to all of those who are out of work and want help”

The Institute for Employment Studies, Labour Market Update December 2021.

If high vacancy rates aren’t being addressed because of high barriers for parts of the unemployed population (i.e. health concerns, care support) then this needs targeted policy support to be addressed. If high vacancy rates aren’t being addressed because of wide skills mismatch then this needs targeted policy support to also be made available and funded. It will involve joined up thinking however, one that can combine employment policy, education and skills, health, welfare as well as economic policy.