2:25PM, Tue Feb 21, 2012

Cash Incentives For Youth Jobs Welcomed By North East Businesses

By Jenny Wotherspoon Location: Newcastle

Video: North East Chamber Of Commerce welcomes the funding

A leading voice in North East business has welcomed a pledge by Nick Clegg to spend £126 million getting young people into work.

The Deputy Prime says the initiative will help tackle the "ticking time bomb" of teenagers who are not in work, school or training.

It is part of the coalition's Youth Contract scheme, announced last November.

Under the initiative, charities and businesses will be invited to bid for contracts worth up to £2,200 to take young people on.

They will receive an initial payment up front, and more money when the youngsters show progress.

At least 55,000 16 and 17-year-old 'Neets' - not in education, employment or training - who have no GCSEs at grades C or above, are expected to benefit.

Around £8 million of the money will be spent in the North East.

North East Chamber of Trade Chief Executive James Ramsbotham told Sky Tyne and Wear: "This is a real attempt to help young people into meaningful training that will lead to meaningful work.

"It is very much a positive step.

"It will reach some of the youngsters that are the hardest to help, show them the benefits of work and try and find them proper jobs. All of that must be encouraged."

By the age of 42, someone who has been frequently unemployed as a teenager is likely to earn 12 to 15 percent less than their peers, according to the Department for Education.

The last Neets figures, for the third quarter of 2011, showed that more than a million 16 to 24-year-olds - almost one in five - were considered 'Neet'.

Mr Clegg said: "Sitting at home with nothing to do when you're so young can knock the stuffing out of you for years.

"It is a tragedy for the young people involved - a ticking time bomb for the economy and our society as a whole.

"This problem isn't new, but in the current economic climate we urgently need to step up efforts to ensure some of our most troubled teenagers have the skills, confidence and opportunities to succeed."

But the scheme has been criticised by the UK's largest teaching union, the NASUWT.

General Secretary Chris Keates said: "The fact that one in five young people are not currently in employment, education or training is a direct result of government economic policy.

"Cutting the Education Maintenance Allowance removed the incentive and opportunity for thousands of youngsters to continue in education.

"Handing money to employers is no substitute for funding young people directly to support them to continue in education and gain qualifications that dramatically improve their career prospects.

"This Government has betrayed thousands of young people and it's a bit rich for the Deputy Prime Minister to now be expressing concern about the ticking time bomb of youth unemployment he was complicit in creating."