Leading energy firm SSE is making the business case for companies to do more to support young people written off from the jobs market.
Young people are three times more likely to be unemployed in the UK than their older counterparts with a “wage scar” blighting them for life – meaning they’re playing catch up on salary for the rest of their working days.
The firm has quantified the economic impact of investing in young people struggling to access education, employment or training to help make the business case for others to invest.
SSE has been working with Barnardo’s for almost a decade to help offer jobs and training to those under 25 and finding it hard to gain work or training. It’s invested over £1million pounds since 2008 but the investment has paid dividends.
It found for every £1 spent by SSE, £7.67 is returned on the investment, split between the young people themselves, SSE and other businesses that have gone on to employ them as well as wider society.
John Stewart, SSE’s HR Director, urged other firms to consider what part they could play in supporting more young people into employment.
He said: “The energy industry faces two enormous employment challenges; a skills shortage with half of the industry due to leave or retire by 2023 and a stark lack of diversity.
“These results make a very compelling economic and social case for a business to address these issues and intervene in one of society’s bigger challenges: tackling long-term youth unemployment.
“The success of the young people in this programme is testament to their grit and determination; they just needed a helping hand on the ladder. Different people, from different backgrounds, have different starting points and sometimes they need a different route to get them into their career.
“This report overwhelmingly demonstrates the value created for young people, for business and for wider society.”
Roseanna Cunningham, Cabinet Secretary for Fair Work Skills and Training, welcomed the findings. She said: “The Scottish Government has consistently highlighted the benefits of taking on an enthusiastic young person to employers, something which is particularly relevant during Scottish Apprenticeship Week 2016.
“This report is further proof that it makes good economic sense to invest in young people. I’d like to thank SSE and Barnardo’s for their work to support into jobs those furthest from the labour market. I’d also like to thank them for their research which I hope many businesses will find useful.”
SSE’s programme with Barnardo’s is one of the most successful in the country with around 70 percent of the people taking part going on to employment with SSE or other firms, education or further training.
Vitally the young people have benefited from increased earning power – they are expected make, on average, £7,231 more in five years than they would have if they’d been left to fend for themselves. The benefits could be even higher once the young people’s personal development, improved self esteem and confidence is factored in.
At the same time the scheme is predicted to make substantial cost savings for government and wider society too with less young people claiming benefits and more paying taxes. For every £1 invested by SSE, government and society gets £2.07 back – or £6,744 per person.
And it’s helped deliver increased profits for the business; SSE is estimated to gain £405,261 over five years as a result of the increased productivity of the 113 participants considered in the analysis.
Beth Porter, 20, of Perth, was languishing on a zero hours contract with a retailer and unable to earn enough to sustain her. She secured a permanent job as a HR administrator with SSE after going through the scheme.
She said: “I wanted to work but I was on a zero hours contract and wasn’t getting enough hours to live and I couldn’t get experience in anything else. I wanted to find something where I could develop but didn’t know where to start.
”The extra support helped me into a job where I can build a career, I wasn’t singled out because of the scheme – I was just given everyday work like the rest of my team.
“Now I’ve mentored several new starters who have since joined my team and have actually recently been offered a new role where I’ll have more responsibilities too.”
Tommy McDade, Employment Services Manager with Barnardo’s Scotland, said: “Barnardo’s is delighted with the findings of this report. It provides clear evidence of the impact SSE’s investment has made on the lives of so many young people.
“Barnardo’s Scotland really values our partnership with SSE, it has developed and grown over the last few years. It clearly demonstrates the value that such a partnership can bring both to meeting SSE’s recruitment and business needs, and at the same time helping so many young people find work and long term careers.”