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Kickstart scheme fails to entice youths off benefits and into jobs

Paloma Kubiak
Written By:
Paloma Kubiak

The government’s £2bn Kickstart scheme to help young people into new jobs has failed to live up to expectations, a report suggests.

The Kickstart scheme was an emergency policy launched in September 2020 to address a forecast rise in youth unemployment as a result of the pandemic.

It was aimed at young people aged 16-24 who were on Universal Credit or identified at risk of long-term unemployment. The jobs would last six months, pay at least the minimum wage and provide a minimum 25 hours work a week. Employers received £1,500 for each Kickstart participant.

As part of the £1.9bn scheme, it was expected to create jobs for up to 250,000 young people by December 2021.

But by mid-December, just 110,000 starts were recorded, according to the House of Commons Committee of Public Accounts (PAC).

The Department for Work and Pensions (DWP) now estimates Kickstart will help far fewer young people (168,000) by 31 March 2022 – the new deadline for job placements to begin.

Further, more than 200,000 vacancies are still waiting to be filled, and it will also cost much less at £1.26bn.

PAC stated that as the scheme was implemented at immense speed, early delivery was “chaotic”, with the DWP “neglecting to put in place basic management information that would be expected for a multi-billion-pound grant programme”.

It said DWP “has not monitored and does not know whether it is putting the right people onto Kickstart, why people who are not taking up Kickstart jobs are not doing so, or what employers are providing with the £1,500 employability support grants awarded for each young person taken on through the scheme”.

Analysis also revealed that more people found non-Kickstart jobs than Kickstart jobs as the economy opened up during 2021.

Further, many young people in receipt of Universal Credit from the start of the pandemic have remained on the benefit since, with DWP “unable to explain why these people have not moved into Kickstart jobs”.

In September 2021, the number of 16- to 24-year-old unemployed people claiming Universal Credit and searching for work for more than one year was approximately 144,000, three times the pre-pandemic number of 48,800 in February 2020. In the same month, there were 186,000 Kickstart vacancies.

“Many employers have been frustrated at how long it has taken to fill their Kickstart vacancies, with many waiting months for vacancies to be filled, with no guarantee they ever will be”, PAC added.

The DWP now has plans to evaluate Kickstart following a number of recommendations published by PAC.

‘Scheme is not a lost cause’

Myron Jobson, senior personal finance analyst at Interactive Investor, said for many young people, the plight of securing a job with meaningful career progression remains “desperately out of reach” after two years of lost opportunities during Covid.

Jobson said: “Although well intentioned, it is hard to view the scheme as anything but a failure at this moment, but it is not a lost cause. It, like many other initiatives that sprung up during the height of the pandemic, was blighted by unprecedented pressures which impaired logistical and organisational capabilities. Covid has had a profound effect on young people’s education as well their employment prospects, and failure to provide effective support risks a lost generation of workers.

“With the end of all legal Covid restrictions in England, with other UK nations expected to follow suit, the hope is more opportunities will manifest to allow young people to flourish.”