The youth unemployment challenge: Day Two of #CIPD12

I’ve written about unemployment, skills and training on a number of occasions – because it is an issue that is close to my heart and because it is an issue that is close to the heart of our economy and future competitiveness.  I was therefore, absolutely delighted to see it taking centre stage on day 2 of the CIPD Conference with a panel discussion involving Peter Cheese, CEO of the CIPD, Michael Davis, CEO of the UK Commission for Employment and Skills, Anne Pickering, HR Director for O2, Toby Peyton-Jones Director of HR for Siemens UK & North West Europe and also Jo Swinson, Minister for Employment Relations and Consumer Affairs.

The debate was a good one and unsurprisingly a number of key themes and issues were highlighted. The current issues that we are experience in youth employment are structural and not cyclical. This is not an issue just driven by the current economic environment, but has been a long time coming as highlighted in this blog by Mervyn Dinnen, caused by a decline in entry-level jobs and a reduction in big one company towns.  Add to this the contradiction of employers requiring work experience and young job seekers’ inability to get that work experience and we have ourselves a problem.

The problems are long-term and structural and likewise the solutions will also be long-term and structural. O2 talked about their inability to actually predict the skill sets that will be required in the future because of the speed of change in technology, requiring them to focus on recruiting mindset and broad skills instead. Siemens, in a rather germanic way, talked about how they had mapped out future mega trends to help understand the markets that they would need to be growing in and therefore which future skills they would be needing.

And of course, there was talk of the education system, vocational training, the role of universities and work experience schemes.

It is probably here that there are more questions than answers. Clearly there is a need for reform, but as I’ve written before, we seem to be dancing around the edges and sending contradictory messages. Take this, all the panelists including Swinson were extolling the virtue of other routes into employment other than university. Agreed. But we don’t seem to act as if it is.

As I tweeted at the time, I struggle to understand why we happily loan someone £27k to study for a degree in Zoology, but we won’t loan a job seeker money to undertake unpaid work experience, workplace training or even to start their own business.  When Government funds workplace schemes they give the money to the employer and the job seeker has to apply for it. Almost as if we don’t trust them with the money in the way that we would someone going to University.

It also strikes me that we place the power with the organisation and not the job seeker. Would an alternative model be to provide the funding to the job seeker? Although it wouldn’t change the overall outcome it would change the ethos. If I think Tesco aren’t providing as good an opportunity as Asda or Lloyds as Barclays then I can take my money to the employer I think would train and educate me best.  Creating competition between employers as well as between job seekers. It would also potentially open up more opportunities with SMEs and other companies who may not have the resources and the structure to apply fo Government funding in the way that larger organisations can.

I’m sure there a thousand holes that can be picked in this argument at the moment and I need to reflect on it and work it through more. But it seems that we would have a better bet if we both empower the young unemployed to find work and challenge organisations to create it. Businesses are competitive by nature, shouldn’t we be making the most of that?

HR, job creation and an economic imperative

How focussed are you on job creation? How often do you have conversations with your Board about growth and opportunity? How often are you talking about investment in the future? Not only the capital investment, but investment in skills?

If it isn’t on your agenda, then I suggest you take a moment with yourself, take a deep breath and start to have the conversation each and every day.

We all know the state of the economy. We all know that unemployment is at the highest level for the best part of two decades. We know that youth unemployment is a social tragedy. And we know that the Government is ill-equipped and ill prepared to deal with it.

So who is going to make the difference?

Well the answer is that business is partly responsible for getting us into this mess, and we are the only people who can get us out of it. And we aren’t going to do that by focussing on cost cutting, rationalisation, downsizing and offshoring. Nor are we going to, in the long run, add value to our business by doing so.

I know that I run the risk of being called naïve here. But is chasing short-term share holder return really less naïve than building long-term structural value in your business? I think not.

We need to be thinking creatively, innovatively about ways in which we can bring new skills into our businesses, the ways in which we can train a future generation of workers and leaders to safeguard the long-term prosperity of our businesses, of our communities and of the economy as a whole.

That means investment, but it does not mean throwing cash away. Investment is about long-term value creation, which in turn provides long-term shareholder return and long-term security and prosperity for our existing and future workforces.

Think about the opportunities that exist, think about the creation of quality internships, think about taking advantage of apprenticeships, stop moaning about the lack of graduate skills and start thinking about what your business can do to train and develop the future generation. Think about taking a risk.

HR has to, HAS TO, take a lead on this. We have to be championing the needs of our businesses, being future focussed, being (dare I say it) strategic. We need to define the imperatives, formulate the convincing arguments and we need to be making them day in and day out. We are supremely placed to not only make the case, but to be the catalyst for economic regeneration.

Large, small, medium-sized, in the public, the private or the third sector. We can all play a role in this, we all need to play a role in this. Because if we don’t, then who will?

The opportunity is there, the incentive is there. The forward thinking, the innovative, the true leaders know and understand this. Success is part risk, part planning. Put the plans in place and take the risk. Step up and take the challenge.

Whether you agree or disagree, I’ll be expanding on this argument, along with Alison Chisnell Group HR Director at Informa Business Information at #TruLondon in February. We’d welcome your contribution here or there.