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Alan Milburn: Minimum Wage Rise Hampers Youth Hiring, Urges Government Action

Alan Milburn warns that increases in minimum wage and employer costs have made it harder for businesses to hire young people, risking a 25% rise in NEETs by 2030s without urgent action.

·5 min read
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Today, Andy Burnham is expected to release a detailed response to Tony Blair’s critique of Labour published yesterday. Wes Streeting, former health secretary and Labour leadership contender alongside Burnham, published his rebuttal in a article last night.

"Labour succeeds when it combines dynamism with fairness, wealth creation with wealth distribution, enterprise with solidarity, ambition with security. The centre-left’s task is not simply to speak the language of markets more fluently than the Conservatives. It is to ensure markets serve society rather than dominate it.
This challenge is not only domestic. The international order itself is fragmenting. The institutions built after 1945 increasingly struggle to regulate a world defined by multinational technology firms, climate pressures and resurgent authoritarianism. It remains unclear whether democracy or tyranny will define the 21st century …
The future belongs to those prepared to harness change in the service of justice. That is the real dividing line in modern politics: between those who believe the future can still be shaped democratically for the common good – and those content to leave it to markets, monopolies and fate. The answers must be new, but they must also be Labour."

Minimum wage rise has made it difficult for employers to hire young people, says Alan Milburn

Good morning. For the second consecutive day, Westminster news is dominated by commentary from a prominent Labour figure associated with Tony Blair. This time, the intervention is commissioned and welcomed by Keir Starmer’s government. Alan Milburn, who served as health secretary under Tony Blair, was once considered a future prime minister and later chaired the Social Mobility Commission. He was tasked last year to lead an inquiry into youth employment challenges. Today, he publishes his first "diagnostic" report, which focuses on identifying the causes of the problem. A second report, containing policy recommendations, is expected in the autumn.

As Richard Partington reports, Milburn warns that Britain faces a potential 25% increase in the number of young people not in education, employment, or training (NEETs), reaching 1.25 million by the early 2030s unless urgent government action prevents the emergence of a "lost generation."

Milburn is releasing the full report, which exceeds 200 pages and is described by readers as exceptionally thorough and hard-hitting, at a press conference this morning.

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Meanwhile, Milburn has been appearing on morning news programs. Inevitably, he was asked about Tony Blair’s essay published yesterday. Milburn did not engage in all the arguments presented by Blair but agreed with the former prime minister on the need to review certain government policies that have reduced firms’ willingness to hire young people.

In an interview on Times Radio, when asked if he agreed with Blair that Labour had created a "climate of difficulty" for businesses to create entry-level jobs due to increases in the minimum wage and the Workers' Rights Bill, Milburn responded:

"Well, certainly every employer that we spoke to raised these issues as real concerns, the minimum wage. No employer really wants to be paying poverty wages to young people, that’s not what you come across.
But there is, particularly in low-margin sectors of the economy, like retail and hospitality, there is no doubt that these changes have had an impact. So that is something the government really needs to think about. If the priority is to create young people’s jobs, then it’s got to create the right conditions for employers to do so."

In an interview on the Today programme, Milburn was asked if he was willing to urge the government to reconsider the rise in employer national insurance and the increase in the minimum wage. He replied:

"Yes, I am … Every employer that I talk to, they will say the same thing. There’s no doubt that the changes that were made a couple of years ago have had an impact on employers."

Agenda for the day

  • 9.30am: The Office for National Statistics (ONS) publishes its latest figures on young people not in education, employment or training (NEETs), along with data on personal wellbeing.
  • 11am: Alan Milburn holds a press conference to mark the publication of his report on young people and work.
  • Noon: John Swinney, Scotland’s First Minister, takes questions from Members of the Scottish Parliament (MSPs).
  • Afternoon: Keir Starmer visits apprentices in London and is expected to speak to broadcasters.
  • Afternoon: Andy Burnham, Mayor of Greater Manchester and Labour candidate in the Makerfield by-election, is expected to respond to Tony Blair’s ‘Labour and the future’ essay.

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This article was sourced from theguardian

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