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3. How realistic are the goals of the Mayors Taskforce? To shift all unemployed young people under 25 years in our communities into work or training ... is a “big ask”. In round figures, we are talking about 75,000 young people throughout the country. I was part of the team which negotiated the partnership between this Taskforce and the Labour Department’s Community Employment Group (CEG). Our goal was to get a CEG field officer in alongside all the Mayors who had signed up to the Taskforce. This field officer would act as a strategic adviser to the Mayors with their local action plans, and also be able to help out with many of the details. At the start of our negotiations, Charlie Moore, the General Manager of CEG, calmly expressed his reservations about the Mayor’s goals. Before coming to head up CEG, Moore used to be a manager at the Policy section of the Labour Department. As we started our meeting, he told us that the “policy adviser in him” considered that that the sorts of goals advocated by the Mayors Taskforce were unachievable. He pointed out that if Steve Maharey, the Minister of Employment, asked the Labour Department for advice on the feasibility of getting all unemployed young people into work or training in four years time, he would probably receive a report — half-an-inch thick — explaining why it could not be achieved. Charlie Moore was putting his challenge politely. He obviously supported what the Mayors Taskforce was trying to do. But he also knew what it would take to navigate such a lofty goal through a political and bureaucratic minefield ... a journey that would be made so much harder without the backing of policy advisers. I thought about his challenge for a while, and then gave a personal response: I don’t want to live in a New Zealand that has no use for a large number of its young people. Actually, the Mayors involved in this Taskforce are taking this initiative just as personally. They are telling us that they don’t want to govern a New Zealand that has no use for a large number of the young people in their communities. The goal of ending the waste of young people may seem ridiculous to some government advisers ... but we need to understand that these are cultural goals. These are goals which talk about the sort of New Zealand we want to live in. In setting these goals, the Mayors are saying they want to lead communities which value having good work, training, and livelihoods for all their young people. And they are willing to put a “stake in the ground” by setting a date which will help to them push towards such a cultural vision.
A cultural vision like this is well understood at the level of the family. You would never find any parent taking seriously policy advice that says their teenagers shouldn’t expect to find a job. In the family we know that obtaining good work is a major symbol of “coming-of-age”. It is a major initiation of young people into the adult world. To deny this, is to hold back the whole “growing up” process that comes from making a contribution through work, and being able to provide for yourself by earning an income. Its hard to imagine any culture on earth where the elders would purposely say to large numbers of their young people: we’ve got no work for you to do. But, in effect, this is exactly what we are saying to one in eight members of the next generation.
It may be surprising to discover that these cultural perspectives are well understood in many parts of the business community. This Taskforce meeting has seen the launch of a new partnership between the Mayors and the NZ Business Council for Sustainable Development (NZBCSD). The Council is establishing a Youth Employment Project in which they plan to produce an industry guide on how businesses can help stimulate youth employment, and encourage all member companies to commit to and report against local employment or training targets. When I was editing a special issue of The Jobs Letter to go with the launch of this project, I interviewed all the “project champions” from the Business Council. These included the leaders of NZ’s largest retail chain the Warehouse; Christchurch’s City Care company; the investment company Money Matters; Urgent Couriers; and NZ’s biggest dairy company, the Fonterra Co-operative Group. During the interviews, each of these business leaders told me that they were joining the Youth Employment Project because they wanted to get in behind the Mayor’s goals. Stephen Tindall, the chairman of the Business Council, said: “This project will obviously improve everything for everybody — including help create better business conditions for our members. We could find ourselves some very good people for the future of our businesses, and at the same time help on a project that has tremendous goals.” Tindall’s reference to helping “create better business conditions for our members” points to the fact the Business Council has quite pragmatic reasons for starting a Youth Employment Project. All the business leaders I interviewed repeated the same story: that a community with large numbers of unemployed young people is not a good community to do business in. And if businesses actively assist in the drive towards achieving full youth employment ... then it becomes a circle of mutual benefit.
The drive to fuller youth employment is certainly being pursued on an international level. Youth unemployment is one of the biggest structural issues facing the global economy. In the next ten years, 1.2 billion young people are going to be entering the global labour market. They will be the best educated generation of young people ever ... and they are all going to be looking for good paid jobs. This is of major concern to the international business community ... reflected in an article in the Financial Times, earlier this month, where it says: “If the world were a company, its chief executive would be dismissed for making such poor use of its assets.” The closest thing the world has to a chief executive is Kofi Annan, Secretary General of the United Nations, and the 2001 Nobel Peace Prize laureate. Annan is indeed trying to bring a greater international focus to the youth employment challenge. Last year, he joined with the ILO Director-General Juan Somavia, and the World Bank President James Wolfensohn, to convene a “High-Level Policy Network on Youth Employment”. And, like the New Zealand Mayors, they have set the goal that “there should be decent work for all young people”. The High Level Policy Network brought together a panel of twelve “eminent persons”, and youth leaders, drawn from private industry, economic policy and civil society. They worked on a raft of recommendations to improve the position of young people in the global labour market. These recommendations — and an action guide — were published in September last year, and have been sent to all national governments. The “eminent persons” have basically called for a new political commitment to full employment. They want full employment to be the overarching goal of global economic and social strategies, and they want to see the integration of public policies for young people into these overall employment policies. The panel also called for young people to be included in the shaping of new solutions: “ ... Young people are now asking that their voices be heard, that issues affecting them be addressed and that their roles be recognised. Rather than being viewed as a target group for which employment must be found, they want to be accepted as partners for development, helping to chart a common course and shaping the future for everyone.
All this puts the concept of these cultural goals into a personal, a family, a commercial, and a global perspective. With this in mind, you might find it is astounding to realise that — apart from the Mayors putting their stake in the ground over these issues — we still have no coherent national strategy on youth unemployment. In just the last fortnight, there has been the release of two major reports which illustrate this. The Minister of Employment Steve Maharey has just released his election-year progress report on the government’s employment strategy. First of all: it must be said that it is a great improvement to have a government that actually has a strategy and is willing to submit itself to progress reports. But while this strategy has six major goals, not one of them brings a focus to the goal of ending youth unemployment. Yes, the challenges of young people finding work are mentioned throughout the report ... but there is no real emphasis on it. Nor is there any mention of the special “partnership” between the government and the Mayors Taskforce on youth employment goals. You might have expected things to be different with another report released by the Ministry of Youth Affairs. “Youth Development Strategy Aotearoa” outlines how the government can support young people to develop the skills and attitudes they need to take part positively in society, now and in the future. Again, while employment is mentioned several times throughout the report, there is no particular focus given to it. I would have thought that there have been enough warning bells. When the Minister of Youth Affairs, Laila Harre, met with the Mayors Taskforce eighteen months ago, she repeated the figures which showed that young people aged 15-25 years had twice the level of unemployment compared to other age groups. And she told us that this high figure persisted despite the fact that there had been an increased participation rate of young people in tertiary education — 16-24 year olds in tertiary education went from 15.4% in 1986 to 23.2% in 1996. The Youth Affairs 1999 Briefing Papers to the Incoming Government also tell us that a greater proportion of young people today live in low income households. And in the decade 1986-1996, the median annual income of 15-25 year olds fell from $14,700 to $8,100 — a drop of 45%! Surely these are enough indicators to give us the motivation to bring some focus to the livelihood issues of young people? This country needs a coherent national strategy on youth unemployment, and we need to put our best brains and our best resources behind it. What if all the major political parties, in this election year, asked the country for a mandate to pick up the Mayor’s goals as New Zealand’s goals? What if Steve Maharey and Michael Cullen walked into their offices tomorrow and asked their policy advisers to give them a report — half-an-inch thick — on how these goals could be achieved? This would certainly give these issues the focus they deserve.
We often hear that “we don’t have the money” to do something about our major social problems. But it’s also worth reminding ourselves that not doing something about youth unemployment is already very expensive. Last year the Mayors Taskforce had its major annual meeting in Manukau City. In preparing my own contribution to that meeting, I came across the results of a report released in 1998 on the real costs of youth unemployment to the economy of Manukau City. The research had been commissioned by the Manukau Local Employment Co-ordination (LEC) group. They asked the accountancy firm Ernst & Young to calculate both the direct and indirect costs to the Manukau community of each unemployed young person under the age of 25 years. The direct costs took into account items such as the cost of benefits, and the costs of providing an infrastructure of government departments such as Winz. In calculating the indirect costs, Ernst & Young used internationally-accepted formulas to account for the additional expenses unemployed people incur in the health system, the impact of foregone income and savings on the local economy, and the additional costs of work schemes and labour market training. Ernst & Young concluded that the combined cost of youth unemployment to Manukau City came to $223 million a year. This worked out to $58,760 for each unemployed young person in Manukau City! It is interesting that the researchers found that the significant costs were not to be found in the unemployment benefits or in Winz. The significant costs were indirect costs. These were costs that do not appear on the ledger of any one agency or institution ... but are systemic to the city. Unfortunately the fact that these are indirect costs also means that no one is really ever called into account for them. There is no-one sitting at a table and signing off on $58,000 for every unemployed young person in Manukau — because these costs never appear on one balance sheet. Which all means that Manukau — and every other city like it — keeps on paying out this enormous price for having no real work for a large number of its young people. It is important also to recognise that the young unemployed people in Manukau are, themselves, not seeing very much of that $58,000. But they do represent a significant centre of market activity for another whole group of people — in Winz, in social services, in the health system ... and in all sorts of industries that have grown up around managing this problem. Which makes you wonder if it would not make simpler economic common sense to just give these young people a decent wage and something useful to do.
Next: The Future of Work
Next: The Future of Work
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