YOUTH UNEMPLOYMENT. Mark Casson

Transcription

1 YOUTH UNEMPLOYMENT

2 By the same author Introduction to Mathematical Economics The Future of the Multinational Enterprise (with Peter J. Buckley) Alternatives to the Multinational Enterprise

3 YOUTH UNEMPLOYMENT Mark Casson

4 Mark Casson 1979 Softcover reprint of the hardcover 1 st edition 1979 All rights reserved. No part of this publication may be reproduced or transmitted, in any form or by any means, without permission First published 1979 by THE MACMILLAN PRESS LTD London and Basingstoke Associated companies in Delhi Dublin Hong Kong Johannesburg Lagos Melbourne New York Singapore Tokyo British Library Cataloguing in Publication Data Casson, Mark Youth unemployment 1. Youth - Employment - Great Britain 2. Unemployed - Great Britain I. Title 331.3'4 HD6276.G7 ISBN ISBN (ebook) DOI / The paperback edition of this book is sold subject to the condition that it shall not, by way of trade or otherwise, be lent, resold, hired out, or otherwise circulated without the publisher's prior consent, in any form of binding or cover other than that in which it is published and without a similar condition including this condition being imposed on the subsequent purchaser This book is sold subject to the standard conditions of the Net Book Agreement

5 For Helen Hudson

6 Contents List of Tables and Figures Acknowledgements x xii 1 INTRODUCTION 1 l.l Scope of the study Definition and measurement of youth unemployment The social significance of youth unemployment Summary of recent statistical evidence Plan of the book 7 2 YOUTH UNEMPLOYMENT IN HISTORICAL CONTEXT Introduction The boy-labour problem Pre-1914 social surveys Youth unemployment in the Great Depression Early postwar studies Recent studies Summary and evaluation of earlier studies 27 3 MODERN THEORIES OF UNEMPLOYMENT Introduction The function of the labour market Imperfections in the labour market Involuntary unemployment Search unemployment Benefit-induced unemployment Queue unemployment The training problem and structural unemployment Seasonal and casual unemployment Impjications for the incidence of unemployment Discrimination 45 vii

7 viii Contents 4 THEORIES OF YOUTH UNEMPLOYMENT 48 4.l Introduction Job-search hypothesis Seasonal-unemployment hypothesis Structural-unemployment hypothesis Life-cycle hypothesis Queue-unemployment hypothesis Benefit-induced unemployment hypothesis School-leaver hypothesis Selective-redundancy hypothesis Trend hypotheses 58 5 STATISTICAL EVIDENCE FOR WEST GERMANY, ITALY AND THE UK, 1973 AND Introduction Duration of search Transitions into and out of unemployment Reasons for job loss Reasons for job search Methods of job search Industrial distribution of the working population 83 6 INTERPRETATION OF THE EVIDENCE Introduction Job-search hypothesis Seasonal-unemployment hypothesis Life-cycle hypothesis Queue hypothesis Benefit-induced unemployment hypothesis School-leaver hypothesis Selective-redundancy hypothesis Trend hypotheses Conclusion POLICY Introduction Job creation: stimulating the demand for labour Reducing the supply of labour An appraisal of countercyclical policies in the UK Minimising frictional unemployment Reversing the trend 117

8 Contents 7.7 An industrial policy for youth employment 7.8 Summary and conclusion Appendix: The EEC Labour Force Sample Survey Notes Index ix

9 List of Tables and Figures TABLES 1.1 Percentage unemployment by selected age groups, 1973 and Employment of men and boys in various establishments, c Mobility of a sample of young workers in Birmingham, Methods of obtaining jobs, Reasons for leaving job, Distribution of occupational status according to potential influences on occupational choice Distribution of predominant reasons for changing jobs, according to number of jobs held Incidence of unemployment according to family background and boy's personal characteristics Employers' view of essential and desirable characteristics of job applicants: a comparison of young people with other re~~ ~ 5.1 Percentage distribution of duration of search, for selected age groups, 1973 and Unemployment rates according to status a year previously, together with the percentage of unemployed who are firstjob seekers, by age group, 1973 and Percentage of job losses attributable to various causes, for selected age groups, 1973 and Percentage distribution of employed persons seeking another job, by reason for search, for selected age groups, 1973 and Percentage distribution of job-seekers by method of job search, for selected age groups, 1973 and x

10 List of Tables and Figures 5.6 Percentage distribution of employment by branch of industry, for selected age groups, Job satisfaction according to age, UK Average gross hourly earnings in selected manufacturing industries, 1973 and Percentage labour-force participation Projected changes in the labour force: UK xi FIGURES 1.1 Youth unemployment and total unemployment in Italy, the UK and West Germany, Disequilibrium in the labour market Effect of benefits on unemployment 40

11 Acknowledgements My interest in the problem of youth unemployment began when I was invited to prepare a report on the subject for the Directorate General of Employment and Social Affairs of the Commission of the European Communities. On their initiative an approach was made to the Directorate of Social and Demographic Statistics of the Statistical Office of the European Communities for permission to use unpublished tabulations from the biennial Labour Force Sample Survey. I should like to thank the Commission for financial support in preparing the original report, and also acknowledge the help received from the Statistical Office, both in preparing the report and in producing the present work. I cannot name the individuals concerned, but nevertheless I am very grateful to them. Needless to say, neither the Commission nor the Statistical Office necessarily concurs either with the analysis and interpretation of the evidence, nor with the views on policy expressed in this book. The manuscript has benefited considerably from the comments and criticisms of Paul Cheshire, John Creedy, Geoffrey Denton, Peter Hart, Ros Ingham, David Metcalf and Richard Pankhurst. Naturally the responsibility for all errors and omissions is mine alone. Special thanks are due to Gerard Dummett, who gave up part of his summer vacation to help in the preparation of the statistical tables which appear in the text. The manuscript was typed most efficiently by Barbara Wall, Joan Horton, Margaret Lewis, Maggie Fillingham and Cynthia Fido. Once again I must thank my wife for looking after the interests of the nonspecialist reader. M. C. C. xii