Employing the unemployable

In another amazingly stupid idea from the government, UK firms are being given financial incentives to employ: 1)University graduates. 2)Long term unemployed.

University graduates:

University graduates spend many years doing exams and expect high salaries. Unfortunately, from an employers point of view, high salary is a high risk and an expense they probably cannot afford. This is because:

• It costs the company a lot of money to pay one person a high salary.



• The higher the salary to a permanent employee, the higher the potential redundancy payment.



• A higher salary means higher pension payments to the employee.



• There is no guaranteed financial return on investment from employing a graduate.



• Supply and demand: there are many qualified, experienced and well educated people looking for work now, so its a no-brainer to find the best person you can, and pay them a beggars wage, as there are not many other options for the potential employee. Why would a company pay a high salary needlessly?
  

In short, paying anyone a high salary is a massive expenditure of money and risk for a company. Sometimes an employee can be worth the money and make more money than they cost to employ, but graduates can take years to reach this level of competence, and may never reach that level.

Far easier to employ cheap foreign labour. We are now in the midst of one of the biggest economic crises the world has ever seen, and anyone who thinks that struggling companies are going to stretch their limited finances to employ and overpay graduates, can dream on.

The funniest thing about the government's new graduate internship plan is that it is only 3 months long. Then it's back to unemployment street. If there are no jobs, then there are no jobs, so their internship is completely pointless.

According to the article in The Telegraph: "They will be paid at a rate only slightly higher than undergraduates' income from grants and loans". OK, lets work this one out. If students are graduating around 20k in debt after 3 years of university study that's about 7k per year income. That's £583 per month. Lets make that £600 so it's "slightly higher". That means this new government plan would see a few graduates being paid £600 per month for a mickey mouse internship. This would only be for 3 months! And who will pay for this? Certainly no business will be stupid enough to throw away any money on training people for only 3 months, who will probably never work for them again. At a possible salary of £600 per month (and it might even be far less than this), there's more money stacking supermarket shelves but with all the competition out there, graduates probably won't even get that.

Here's a comment from a recent university graduate on the BBC website which pretty much sums it all up: "I graduated in July 2008 with a languages degree and despite my best efforts I still find myself without work. I am beginning to feel increasingly despondent at my lack of success in securing a job and frustrated by the dearth of opportunities and provision for recent graduates. I have in previous years claimed Job seekers' Allowance but found the experience demoralising and for all intents and purposes rather useless. The proposal to offer internships seems to be a step in the right direction but still somewhat limited in efficacy as it holds no guarantee of a stable, long-term position".

I feel sorry for graduates, many of whom will have worked hard for their degree, entering one of the worse economic times in history, with little chance of getting any job, and possibly £20,000.00 or more worth of debt encasing their feet like cement blocks. The auction house Christies is currently making job cuts and one of the first things they did was to sack their 30 graduate trainees.

This is now one of the worst times in history to be a recent graduate. There are too many graduates chasing too few jobs.

Long term unemployed:

The long term unemployed, are people who have been unemployed for many months or years and are usually claiming benefits. This group of society have a bad reputation as lazy scroungers. This is not really a fair assessment of everyone, and I think some people are genuinely unlucky to be unemployed. Obviously this number will rise massively over the next 2 years, as the global financial crisis becomes even worse.

The governments plan is to give employers £2,500 for every person they train. But after this the companies will have to pay these people a salary out of their own finances. Its hard to see that happening, as businesses are currently laying people off, or having hiring freezes, or simply going bust. Why would they add to their misery by giving their money away to the long term unemployed? That's the governments job.

If you were an employer, would you want to employ someone who will do nothing in your business all day, cost you money to pay them a salary, and possibly even bring the company down? This may not be a fair assessment of all unemployed people, but employers will not take the risk, especially in this terrible economic climate.

In conclusion, the unemployable cannot be employed if there are no jobs, no matter how keen or well educated they are. At this moment in time, I would advise anyone to take the highest paying stable job they can find, no matter what it is. Now is not the time to be picky or proud, or to try to find the job you love. Now is the time to pay the rent, get a stable job if you can (such as a bus driver), and then budget, so you have the facilities to seek wealth.