Tuesday, December 14, 2010

Back to School?

The Construction Sector has seen the greatest destruction of employment in the ongoing recession.  Employment in this sector peaked at over 270,000 in the middle of 2007 but has now fallen to just 113,000.  The biggest sufferers of this decline are men, and in particular young men.

When construction output was at its peak there was 160,000 males aged between 15 and 24 in employment across the whole economy.  The most recent figures show that there are now just over 80,000 males in this age category in employment.  The number of unemployed males in this age category has ‘only’ increased from just under 20,000 to nearly 59,000.  Of course, these cohorts are not suitable for a direct comparison as the 2010 cohort of 15 to 24 year olds will be a much different group to those who were in the same age group in 2007.

One impact of the demise of the construction sector has been the relative increase in the attractiveness of education to males as a result of the decline in their employment and earnings potential. 

Numbers of Students

After declining steadily relative to females during the construction-fuelled Celtic Tiger II phase, the number of males aged over 15 in education has been rising since 2007.  This can be readily seen if we look at the ratio of male to female students.

Male-Female Student Ratio

We can see that at one stage there were only 85 male students aged over 15 for every 100 female students.  Now the numbers are close to parity.

One useful comparison we can make between the 2007 and 2010 groups is the Labour Force Participation Rate. 

Male 15-24 Participation Rate

Labour force participation has fallen from around 60% four years ago to 45% now.  Even with this increased enrolment in education and ensuing drop in labour force participation the collapse in employment for young males has still seen extraordinary unemployment rates recorded.

Male 15-24 Unemployment Rates

The unemployment rate is over 30% among 20 to 24 year old males and is over 40% among 15 to 19 year old males who are in the labour force.   We are in the midst of a major unemployment crisis but look at how moderate the increases in the overall rate seem when compared to the increases in the unemployment rate among males aged under 24.

It would be useful to see targeted suggestions to tackle this problem rather than the usual platitudes we get about “solving the jobs crisis”.  For a start it would help if there was a greater degree of understanding of the problem we face.  And 35% unemployment among young males is a serious problem that will not be solved by hoping they all go back to school.

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