The disturbances this summer may be only a foretaste of what is to come from a generation this government seems to have abandoned

Diane Abbot produced a long whinge about youth unemployment in the Huffington Post.

"It seems as if a whole generation of young people is going to pay the price of this government's economic policies.

A whole generation may be doomed to a lifetime on the fringes of the job market."


The labour market for young people is very fluid. Many young adults are transitioning from education to employment. Others have specific career goals that demand lengthy application processes. Perhaps, the best guide to the youth labour market is the number of people aged 18-24 who have been unemployed for more than six months.

So what does the data tell us?  Long term youth unemployment did increase sharply. Unfortunately for Diane, the greater part of that increase occurred before the last election when Labour were in office. The last available data is for August 2011, when 108,000 young adults were unemployed for longer than a year. In June 2010, that number was 96,000, while in 2008, it was only 38,000.

Throwing around partisan numbers has only limited usefulness. What we need is practical policies to increase growth and lower unemployment. Diane thinks that the solution lies with the public sector. If only the government were bigger, then youth of Hackney would find a job:

"(T)he cuts in the public sector are slashing jobs which the private sector cannot replace. Neo-liberal economic theory says that if you slash the public sector the private sector will grow.

In reality cuts in the public sector also affect private sector jobs in areas like building and construction, that depend on public sector contracts for schools etc."

The answer is simple; more public expenditure creates more private sector jobs. Instead, that stupid Mr. Osborne is "doggedly pursuing policies designed to appease bankers and the bond markets".

Diane ends her post with the ominous threat of violence.

(Mr. Osborne) has to be prepared to rethink his policies. Otherwise the disturbances this summer may be only a foretaste of what is to come from a generation this government seems to have abandoned."

If the coalition doesn't reverse their cruel cuts, then the kids will go out onto the street and trash the local high street.  Forget about elections and democracy, government policies should be designed to placate thieves and rioters.

Perhaps, I am being a little unfair, but it is perhaps useful to contextualize Diane's argument with a few additional observations:

1. Public expenditure rose sharply during the last 18 months of the previous Labour government. It now accounts for about half of GDP.  At the same time, long term youth unemployment more than doubled.  
2. The Coalition came to office about a year ago, and long term unemployment is broadly unchanged. However, Diana blames the coalition for youth unemployment, despite the data suggesting that Labour was responsible for the increase. 
3.  She wants higher  public expenditure, even though the correlation seems to suggest higher public expenditure is associated with higher youth unemployment.  
4. She claims that we are likely to see more street violence from disaffected youth if the coalition continue to balance the government's accounts.

Hopefully, Mr. Milliband and his colleagues can do better than this....