Short video on oil prices - cause and effect, Dec 2015

Youth unemployment and apprenticeships - a ready-made solution?

‘Pitiful’ figures cast doubt over apprenticeship target

Julia Belgutay

18th December 2015 at 00:15

• Share on Twitter
• Share on Facebook

FE

Poor take-up of traineeships could scupper plans to help millions, claims MP 

The government’s ambitious plans to expand the apprenticeship programme could be thwarted by the “pitiful” take-up of traineeships, the shadow FE and skills minister has warned.

Traineeships were introduced in 2013 to equip young people with the skills required to progress into an apprenticeship or employment. However, recent statistics from the Department for Business, Innovation and Skills (BIS) suggest that the government has found it difficult to grow the programme. The number of traineeship starts in 2014-15 was 19,400, compared with 499,900 apprenticeship starts in the same period.

And new figures reveal that the number of traineeship vacancies advertised on the official apprenticeships website has dropped by 9 per cent, from 2,300 between August and October 2014 to 2,100 in the same period 12 months on. In contrast, the number of traineeship applicants actually rose in 2015-2016.

Last week, the government announced new measures to allow more providers to offer traineeships, which it claimed had made an “excellent start”.

Previously, only providers rated good or outstanding by Ofsted were eligible, but that restriction will be removed in August 2016. A new campaign to promote traineeships and apprenticeships were also unveiled. But Labour’s shadow skills minister Gordon Marsden told TES that a lack of awareness about traineeships was a major factor behind the low number of learners on the scheme.

“They were not well understood so take-up has been rather pitiful,” he said. “I am not surprised at the figures because how they introduced it was completely cock-eyed.

“They were originally set up to allow young people to step up to high-quality apprenticeships, but the government introduced them and gave them no marketing. There seems to be a blurring of clarity over what it is the scheme actually does.”

Stewart Segal, the chief executive of the Association of Employment and Learning Providers, said that it was vital to expand the traineeship scheme to help prepare young people for apprenticeship-level training.

“Quite a lot of young people are still coming out of school without the work-related skills to take on an apprenticeship. An apprenticeship is a job and quite a lot of those young people need the experience first,” he added.

The concerns have been raised after the government published its apprenticeship strategy last week, with plans for a statutory target for the public sector to deliver “its fair share of apprenticeships”.

English Apprenticeships: our 2020 vision also sets out the government’s wider plans for reaching its target of 3 million apprenticeships by 2020, which includes the introduction of the apprenticeship levy.

Mr Segal said “greater effort” was needed to promote apprenticeships. “In the last couple of years we have increased the age of participation and therefore we need to make sure young people know they have an opportunity to go into an apprenticeship and that they now get better careers advice,” he said.

Figures published by BIS earlier this month show that the number of apprenticeship vacancies has increased significantly in the first quarter of 2015-16, compared with the same period in the previous year. However, the number of applicants for apprenticeship posts has not risen at the same rate – meaning that there are now significantly fewer applicants per vacancy than last year.

A City and Guilds spokeswoman said that initial funding and levy investment were “a good start” in increasing apprenticeships, but added: “The main worry is that the desire to hit targets and count all things as apprenticeships could overtake the need to maintain the quality of what an effective apprenticeship means.”

A spokesman for BIS said that not all traineeships were advertised on the official apprenticeships website, and insisted that they were “at the heart of the government’s drive to tackle youth unemployment”.

“Hundreds of major employers, such as Jaguar Land Rover, Virgin Media and the BBC, are already delivering traineeships, as well as smaller employers locally,” he added.

What a rich weekend for reading material

• Subscribe
• Share
• Past Issues
• RSS
• Translate

The Sunday newsletter from Project Syndicate. View this message in a web browser. SUNDAY, DECEMBER 6, 2015 This week at Project Syndicate, Mohamed El-Erian examines the policy disparity between the Fed and the ECB, Nouriel Roubini hopes that the threats facing Europe lead to greater solidarity, Carl Bildt argues that the roots of the Middle East's current conflicts lie in the collapse of the Ottoman Empire, and more. Join the discussion. The Great Policy Divergence Mohamed El-Erian worries about the international repercussions as the Fed and the ECB move in opposite directions. Europe's Barbarians Inside the Gate Nouriel Roubini argues that the main threat confronting the EU is its dearth of unity. Preserving the Ottoman Mosaic Carl Bildt warns against attempting to impose new borders in the Middle East. From the MIT Press   Greening the Global Economy By Robert Pollin "In clear and readable prose, Robert Pollin details how, contrary to the insidious claims of Big Oil, burning fossil fuels at current rates is bad for the economy, bad for the environment, and bad for the poor. Greening the Global Economy powerfully demonstrates that investing in efficiency and renewable energy generates a far better standard of living than the current alternative – abject and massive dependency on fossil fuel." – Jerry Brown, Governor of California China's Twin Challenges Adair Turner is losing confidence that the country's leaders will manage the debt dilemma they face. Managing a World of Great Powers Javier Solana says that rivalry among the US, Russia, and China need not block collaboration on major challenges. The Right Price for Preserving Our Climate Christine Lagarde shows why "smart" taxes to cover the full cost of fossil fuels is essential to curbing their use. From Good Intentions to Deep Decarbonization Jeffrey Sachs worries that the Paris climate talks will embrace short-term solutions that negate long-term goals. The Syrian Knot Joschka Fischer believes that peace is possible, but not with Bashar al-Assad or ISIS still on the scene. The Politics of Islamophobia Ian Buruma finds striking parallels in the political use of fear by Islamic State and Western politicians. Blinded By ISIS Shlomo Ben-Ami argues that the Islamic State is a symptom of a deeper problem that a ground invasion cannot fix. Project Syndicate publishes and provides, on a not-for-profit basis, original commentary by the world's leading thinkers to nearly 500 media outlets in over 150 countries. This newsletter is a service of project-syndicate.org. © Project Syndicate, all rights reserved. Unsubscribe from this list

Y13 extension material - negative interest rates

We will have to look at negative interest rates in more detail in our next section on deflation; you have already identified they exist - 5 years ago they were like sasquatch (bigfoot), i.e. rumoured, discussed and extraordinary, but not under consideration in the mainstream. Now there is widespread discussion about them, they exist in several countries (in Switzerland out as far as 10 years!), countries such as Italy (140% debt-to-GDP ratio) can borrow at negative rates, and they are now considered as a potential tool in many other countries, including the UK. Read more below:

Matt Rognlie on negative interest rates by Tyler Cowen on November 30, 2015

What Lower Bound? Monetary Policy with Negative Interest Rates (Job Market Paper)


Abstract: Policymakers and academics have long maintained that nominal interest rates face a zero lower bound (ZLB), which can only be breached through major institutional changes like the elimination or taxation of paper currency. Recently, several central banks have set interest rates as low as -0.75% without any such changes, suggesting that, in practice, money demand remains finite even at negative nominal rates.


I study optimal monetary policy in this new environment, exploring the central tradeoff: negative rates help stabilize aggregate demand, but at the cost of an inefficient subsidy to paper currency. Near 0%, the first side of this tradeoff dominates, and negative rates are generically optimal whenever output averages below its efficient level.


In a benchmark scenario, breaking the ZLB with negative rates is sufficient to undo most welfare losses relative to the first best. More generally, the gains from negative rates depend inversely on the level and elasticity of currency demand. Credible commitment by the central bank is essential to implementing optimal policy, which backloads the most negative rates.


My results imply that the option to set negative nominal rates lowers the optimal long-run inflation target, and that abolishing paper currency is only optimal when currency demand is highly elastic. The paper is here, and it contains many new analytical points. As you would expect from Matt, it is also extremely well-written.


Here Eric Lonergan criticizes Swiss negative interest rates. On the blog of Miles Kimball, you will find many arguments for negative nominal interest rates, and also the abolition of currency, another topic covered by Matt in his paper.

A visualisation of Japan's debt problem

More supply-side (and fiscal!)

HS2 to arrive early - in Crewe?

Jonny Clark     30^th November 2015

Now, there are not many things that those of us who live near Crewe can crow about at the moment (although the mighty Crewe Alex did manage to get themselves off the bottom of League One at the weekend). However, today's announcement that the first part of the HS2 rail link that will be completed six years early (yes, six!) will join the UK's second largest city, Birmingham, to..... Crewe.


On my journey around the country delivering CPD I often tell people that I live near Crewe and the usual response is 'oh yes, I've been through there on the train'. The town has a long and proud heritage associated with trains (the aforementioned football club is nicknamed 'The Railwaymen') but it may seem a little odd that the first part of the building blocks that will unlock the 'Northern Powerhouse' will come to this little place in South Cheshire.

The answer lies not in what Crewe itself has to offer but its position with regards to facilitating the further expansion of the rail link. 


 The town is positive to the development, with little objection to the obvious disruption that will be caused to the beautiful countryside that surrounds the place. There is that tradition that I mentioned, with a new University Technology College opening soon that will specialise in engineering alongside the external economies of scale that arrives from decades of railway experience and rolling stock production. Geographically it then allows a 'hub' to take trains on to Manchester and Liverpool - key players in the Northern Powerhouse setup that George Osborne has so often discussed.


Click here for a link to the BBC website for a little more insight and analysis, as well as an artist's impression of the new station at Crewe. Imagine the size of the WH Smith!