Why young people could be key to the UK’s economic recovery – if only they could find jobs

The British Retail Consortium’s polling data says younger demographics feel noticeably more confident about going out and spending money in the wake of Covid-19, writes James Moore

The queues are coming: unemployment is expected to surge past 3 million (PA)

The UK government has good reason to fear a second wave of the coronavirus. The economy is in dire straits and it will not be fixed by the prime minister’s theatrics or his falsely comparing himself to America’s Democratic wartime president Franklin D Roosevelt.

Boris Johnson says it’s safe to go to the shops (apart from in Leicester). The public is, as a rule, taking it a lot more carefully than the hordes who ignored social distancing while making a mess of Bournemouth’s beaches during the recent heatwave.

The early returns from the reopening of non-essential outlets, however, suggest that younger people are notably more comfortable with emerging from what Johnson has referred to as the national hibernation than are their older peers.

Let’s look at retail. Figures from the British Retail Consortium show that retail footfall remained down by more than 50 per cent on the year in the second week of England’s and Northern Ireland’s reopening. However, it increased by 7.7 per cent compared to the previous week, a hopeful sign for this hard-pressed industry.

Here’s where it gets interesting. When the BRC commissioned Opinium to poll shoppers (the field work was conducted between 19-22 June) there were some important differences in responses depending on people’s age.

The researchers asked participants what they intended to do “now that many shops have already reopened, or will soon be reopening”.

Some 15 per cent said they planned to visit shops to browse or make purchases. But among 18-34-year-olds the number was 21 per cent, falling to 16 per cent for 35-54-year-olds and 10 per cent of those aged 55 and above.

Only 24 per cent of the youngest group said they’d “avoid going into shops if at all possible”, rising to 27 per cent of the middle group and 33 per cent of the oldest.

Some 50 per cent of the youngest group would “only go to the shops when necessary” but that rose to 54 per cent for both the middle and older groups (the remainder in each being compromised of don’t knows).

That makes sense when you consider that the older you get the more at risk you are from the virus.

Younger demographics, anyway, tend to go out more as a rule, for obvious reasons and it wouldn’t be surprising to see similar trends emerging when the hospitality sector – pubs, restaurants, cinemas, etc – starts to reopen.

There was another question posed about shops’ safety measures which included the option: “Nothing would make me feel comfortable shopping in store at the moment.”

For 18-34-year-olds, that answer was chosen by just 12 per cent of the sample rising to 14 per cent for 35-54s and to 21 per cent for those aged 55 and above – more than one in five.

Now, the dreadful state of the economy was underlined by the latest revision to the official GDP number for the first quarter of the year. The Office for National Statistics downgraded the estimated contraction to 2.2 per cent from 2 per cent.

That’s the joint largest fall in output since 1979. It will, however, inevitably be eclipsed by the data for the second quarter. The first quarter included only the first week or so of lockdown. It was officially imposed on 23 March, although data from the big tech companies suggests that a lot of Britons had already started to moderate their behaviour as fears of the virus grew. Nearly all of the second quarter has been locked down.

Now the reopening has started it would serve the economy well for young people to have money in their pockets because they’re markedly less fearful about going out to spend it than are their parents and/or grandparents. Assuming that it is indeed safe for them to do so (and it should be said that scientists have their doubts).

Of course, you can see the problem: mass unemployment and, in particular, mass youth unemployment.

The Youth Employment Group Secretariat, made up of various organisations with experience in the field, points out that young people tend to be more vulnerable to economic downturns than their older peers. In the previous recession their unemployment rate grew three times faster.

The secretariat is concerned that in this recession, the impact on them will be greater still because they will be hit by a “perfect storm”. Sam Windett, director of policy at Impetus, which works with young people from deprived backgrounds, defines this as a combination of “weak demand in the economy and high competition for available jobs, particularly in ‘shut-down’ sectors”.

The government has announced an “opportunity guarantee”, that will offer every young person an apprenticeship or an in-work placement.

However, as Frances O’Grady, general secretary of the TUC, says: “What young people need is a guarantee of a job on a decent wage – not just a work trial.”

All the more so because young people may be the key to the UK’s economic revival. They need to have money in their hands just as it’s being snatched from them.

It will require more than Johnson’s cheap sloganeering to address that.