Economic inactivity of young people aged 16-24: Definition, reasons and potential future focus

Gaps in the existing evidence

This paper has shown that there is a range of data available that focus on economically inactive young people. Current open data sets such as the Annual Population Survey and the Annual Participation Measure, offer some insight into the Scottish context. A full description of data sources and publications is available in Annex B. Further to this, there are also grey and academic literature that explores both the UK and Scottish context and offer insights into possible reasons for economic inactivity amongst young people between 16 and 24 years old.

However there are some gaps in the existing evidence described in this paper:

• The existing open data sources do not allow for a further breakdown of individual characteristics in order to better understand the composition of this cohort due to sample sizes becoming too small to produce reliable estimates.
• Reasons and barriers could be further explored in a quantitative form to allow for a greater understanding of the distribution and proportion of how inactivity is affected by individual level characteristics.
• Further breakdowns in addition to the ones presented in this paper could be of potential interest. For example, it would be relevant to have more complete breakdowns by local authority for each of the characteristics of interest (e.g., age bands, sex) as well as a complete urban/rural breakdown for the entire cohort of interest (i.e. 16-24 and not just 16-19 year olds through the APM). This could offer further insights into any potential location-related reasons for economic inactivity and help understand more about this group of young people and where they are.
• Ethnicity breakdowns would also be helpful to highlight clearly the groups within this cohort that might need further support to engage with the labour market, and also for understanding their reasons for not currently engaging. APS data 2021 shows that young people 16-24 from minority ethnic groups are more likely to be out of work when compared with white young people 16-24 (gap - 19.6 pp). In 2022, a report from the Resolution Foundation suggested that in the UK young women aged 18-24 from Black, Bangladeshi and Pakistani ethnic backgrounds registered the biggest increase in economic inactivity. Thus, further exploration of existing datasets in order to better understand the influence of ethnicity, together with gender, in inactivity within Scotland could be helpful in policy development.
• High-level findings show that 16-24 young people saw the highest increase of inactivity when they reported previously working, from 6.4% in 2019/2020 to 7.6% in 2020/2021. It would be of interest to further explore existing variables in the APS regarding willingness to work and history of working previously as ways to better understand the characteristics of this cohort.
• Further to the previous point, it would be helpful to get a better understanding of how young people within this age cohort transition between different status (e.g., inactivity, employment, student, training). Since this is an ever changing topic, accessing data over different years and across time on each individual’s journey would be useful to understand how different groups are affected by different circumstances. Similarly, this could aid our knowledge about what can be done to support these groups.
• There appears to be a lack of up to date qualitative data that explores the Scottish context with only a few studies found which explore this. Some grey literature and academic research explored barriers and reasons for inactivity however the depth of information is larger for the UK, and does not show the same depth for young people in Scotland.