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Sunday, April 03, 2011

It is not what you say but what you omit

Stephanie Flanders is the BBC’s Economic Editor. She recently blogged about what she saw as unfair way in which the over-65s were getting a disproportionate number of jobs at the expense of the young.

This is what she said:
Long term it's excellent news for our economy - and the Treasury - that older people are staying in work. But we cannot afford for that to come at the expense of those who are just starting out. It cannot be good news for the Britain's inner cities that the unemployment rate among 16-24 year olds is now more than 20%.

This is simplistic “zero sum game argument” that there are a fixed number of jobs available and that a job taken by an old person is one less for the young.

To come to this conclusion she had analysed the UK’s employment stats.

What is interesting is not what she said but what she failed to say. Increasingly, I find that people make an argument using a single dataset and fail to consider other explanations for their conclusions. Most of the times it is because they are not very bright and are looking for simple answers to complex questions.

Ms Flanders is no fool, which makes her unwillingness to consider the multiple dimensions of the question more disturbing.

Was it is a matter of expediency that resulted in her dashing out an incomplete argument or was it an intentional omission? I am a charitable guy, it is a Sunday, and so I will assume it was the pressure of time.

First things first. There is an unemployment problem for all ages. Whether it is the inability of a young person getting their first step on the employment ladder or an older person forced out of work before they have amassed sufficient wealth to fund their retirement, it is bad news.

But, there are multiple reasons for the employment pattern and the way that the statistics are reported.

Perhaps when she has a bit more time Ms Flanders might like to incorporate the following into her argument.

Demographics
Look at the change in the absolute number of people in the young and age groups. This graph shows how the numbers change compared to the 2008 figures. Notice anything?

Competition from overseas
Look at the numbers from the ONS’s latest employment data. Notice anything?

Competence

A recent government report came to the depressing conclusion that much of the education is of such a low quality that it doesn’t improve young people’s employment prospects.

The recently retired head of Tesco had a scathing attack on the standards of young people entering the workforce.

Not comparing like with like

The way that employment stats are created doesn’t distinguish between those who are self-employed and those working for an employer. Unfortunately, the term self-employed is often another way of saying “looking for work”.

How many of the jobs are low paid part time employment?

Misleading stats

I have already written about the misleading way that youth unemployment is reported.

The bottom line is that there is a ready audience of dimwits who look for ‘facts’ to support their prejudices. Ms. Flanders should know this and ensure that if she does provide ‘facts’ they are a complete and not a partial view of the truth. Dick Stroud

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