In the 80s Michael Heseltine wrote:  

The waste and hopelessness of unemployment both defy measurement. If the physical cost is great and undiminishing year on year, the human cost is also great and being paid on a constantly rising tariff as children follow parents into unemployment . . . forced into dependence on State benefits. Where unemployment is long-established and deep-seated, its corrosive effect goes equally deep. The rising generation is made vulnerable to the person who says: ‘This is a rotten society . . . why not join us on the streets’. . . Against a background of high unemployment the invitation to crime becomes more appealing. Idleness becomes a resentment that gives crime a defensible normality. 

Twelve years later in 2009 Professor Richard Layard and Paul Gregg asked if creating a new lost generation could be avoided. They had high hopes of  the new youth guarantee scheme which was to start in January 2010: everyone unemployed for over a year and under 25 was to be offered a job or training. 

An online search reveals that Chief Secretary to the Treasury Danny Alexander has said this extension will no longer go ahead, and cancelled eleven other projects set up by the previous government. One is the £290m Future Jobs Fund, part of the Young Person’s Guarantee, intended  to create more than 100,000 jobs by March 2011. It was aimed at 18- to 24-year-olds who had been out of work for more than six months. One in five 16-24 year olds is now unemployed, according to figures released in June.  

Denmark and the Netherlands are said to prevent long-term unemployment 

Layard and Gregg believe that the key is to prevent long-term unemployment in the first place, just as Denmark and the Netherlands prevent it by offering work or training to every unemployed person within a year of their becoming unemployed. They have the lowest unemployment rates in Europe. 

They conclude: “We should do the same. For unemployment is a major source of misery. Unemployment reduces a person’s well-being as much as does divorce or bereavement. Afterwards, there remains a lasting scar not only on happiness but also on future earning capacity and job prospects – making long-term unemployment early in life an economic catastrophe.” 

Already almost 4000 city families have benefitted from work created or retained by the support, advice and unsecured lending of the ‘not-for-personal-profit’ Aston Reinvestment Trust. 

The approach advocated by the Green New Deal and adopted in Birmingham offers constructive work, providing the jobs which would give purpose to skills and training schemes.