One of the great failures of the past decade has been the failure to tackle the problem of low social mobility.
One important role for public policy is to create a world where your fate is not determined in the early years.
DIUS is crucial because it is responsible for what I think of as the school-to-work system, which functions less well here than in most other advanced Western countries. This matters more than ever in the chill winds of recession. In tough times like these, the danger is that the recession hits people in the transition even worse than any other group.
And it is not just because of the recession. Even in the boom times we were underperforming. We should never cease to be shocked by how - despite spending so much money, despite so many well-intentioned initiatives and despite an overall increase in employment - the problem of young NEETs has been getting steadily worse under this Government. In the ten years from the fourth quarter of 1997 to the fourth quarter of 2007 the number of Neets went up from 664,500 in 1997 to 782,500 an increase of 18%. And now, on one measure, it is up to 840,000.
Meanwhile other countries have been doing much better:
So even before the recession started, we were failing our young people.
This is a public policy failure. It is not inevitable. We can do so much better.
The policy mistakes start with a wrong analysis to do with the poverty of aspiration. This was the central theme of the recent report from the Cabinet Office. But I am not at all sure this is true. I would make a modest bet that, if you stopped a male teenager in street in Liverpool this Friday night, deep down what he wants when he is older is to be happily married with a decent job, and a house, of their own.
This is confirmed by an important study by Rathbone. It found that all the young NEETs they interviewed did have clear aspirations: 'At the workshops with young people, all of the participants expressed some form of aspiration, many of which were highly specific... they were able to express clear and precise aspirations.' Furthermore, they aspire to have conventional jobs: for example, chef, solicitor, holiday rep, bar worker, plumber, shop worker, soldier, fire fighter and so on.
However, 'it was also clear that they did not have a planned trajectory for achieving those aspirations' and they were pessimistic about where they would be in 10 years time.
The study concluded: 'All of the young people who participated in the workshops had remarkably normal aspirations: a job, a home, a car, a family. The issue is perhaps less about raising aspirations, and more about providing the means to realise existing aspirations.'
So our young people do not suffer a lack of aspiration, but they do often have a lack of wherewithal. Nuffield/Rathbone concluded: "The issue is perhaps less about raising aspirations, and more about providing the means to realise existing aspirations."
This is the right analysis with the right policy conclusions - we need clearer routes through training to work. That is the failure which I am determined to tackle. And it is even more important at times of recession.
But now, whatever your background or wherever you are, you will be hit by this recession. It is not just the NEETs who are vulnerable. There are new risks for apprentices. There are apprentices halfway through their apprenticeships who face the double disaster of losing their job and their training as their employer goes bust. That is why today I can announce that we propose to create a national database of alternative posts for apprentices who have lost their jobs in the recession. It takes the Government's proposal for the construction industry and applies it across all of the British economy.
Another group of young people hit by the recession is students about to leave university. All the evidence is that university graduates are finding it much tougher getting a job than for over a decade. In December 2008, the Bank of England reported its business contacts are planning to reduce headcount by cutting back on graduate recruitment: "And the majority of contacts were looking to reduce head count over the next few months. For many, this could be achieved without redundancies - for example by cutting back on graduate recruitment." (Bank of England, Agents' summary of business conditions, December 2008,) One survey found that in April 55% of graduates were 'very confident' of finding a job, now only 10% are very confident and almost half say they are not confident.
Above all, I see this as DIUS's role: managing, easing, and facilitating the transition from childhood to adulthood - in practical terms from school to university, college or work rather than to the dole queue. These transitions are difficult at the best of times, and can seem impossible in the worst of times.
At the heart of this is better careers advice. So I could ask the present audience: how much information do you give to your pupils about the transition to HE, FE or apprenticeships? On what basis are potential sixth-form pupils advised about A level choices? Are they advised at all? How would you respond to a pupil who asked whether they should apply to the local FE college?
The evidence shows that the present system is not working. In 2004, National Audit Office found staff without formal qualifications co-ordinated/delivered careers advice in two-thirds of English schools. In June 2008, the National Audit Office concluded: "Poor advice and guidance can lead to individuals making poor choices of qualifications to study at school and college, making unrealistic applications to higher education or not applying at all."
Since 2001, we have seen the erosion of good quality careers advice in schools. The Skills Commission says: "there has been a decline in the quality of careers guidance since Connexions replaced the Careers Service [in 2001]."
And there is very worrying evidence that poorer children rely more on their parents than on careers guidance received in school, unlike wealthier peers. Poorer children are twice as likely to rely on their mother as on careers advisers for information about higher education.
That is why we will introduce a £180 million independent careers advice service for all secondary schools. It will be independent, for example giving information about the most appropriate mix of A levels for individual students, rather than the A-Levels that would most aid the school's league table standing. It will be in all schools, so every child is given advice. And it will be an all-age careers service, to help those who are already NEET and missed out on good advice at school.
We should also give much more information to parents and students before asking them to invest in a degree course. Careers advisers should also have better tools at their disposal. Pupils should be able to see:
In partnership with Anna Vignoles of the LSE, we are looking at how the data which is available on graduate outcomes, from various sources, could be presented so that you would be able to see granular information on the advantages of taking different courses and going to different universities.
There is something else too. In 2008, the House of Lords Economic Affairs Committee
"were left with the strong impression that the Government is doing very little to establish a clear pathway from apprenticeships to higher levels of education."
Just 171 advanced apprentices progressed to HE in 2002-03.
UCAS recognise Grade Five violin and 'British Horse Society Stage 3 Horse Knowledge & Care' but not vocational qualifications, such as an apprenticeship. We will provide £20 million a year (by year 3) for 1,200 Higher Education Scholarships, allowing us to quadruple the number of apprentices entering HE each year. That is more bursaries available, through employers, for qualified apprentices to fund part-time study. A decision to go into further education or an apprenticeship does not have to be a final decision - apprentices can go to university too.
The latest ONS figures show unemployment among 18-to-24 year olds reaching a 13-year high of 579,000. Employment for those aged between 18 and 24 fell twice as quickly in the last quarter as the average. The recession must not be the equivalent of that notorious device the mosquito, targeting the younger age group. Our policies are designed to ensure that this does not happen."