News from Cass Business School

Deprived youth hit hardest by recession

Tuesday, 9 June, 2009

Thousands of Britain’s poorest youngsters will bear the brunt of the recession, warns a report published today by The Prince’s Trust and ESRC Centre for Giving and Philanthropy, Cass Business School.

Young people will be hit hardest in deprived areas as unemployment rises and local youth services become vulnerable to cuts, according to the report.

It warns that youth charities may be unable to keep up with demand, as their services face spiralling demands from disadvantaged young people.

More than 450,000 under-25s in the UK currently claim Jobseeker’s Allowance. This figure has risen by more than 80% in the past year alone, costing the state more than £23 million per week in Jobseeker’s Allowance .

One in six young people are already claiming Jobseeker’s Allowance in some areas of the UK, including Merthyr Tydfil, South Wales and Wansbeck, Northumberland. This figure has risen to one in five young people in Blaenau Gwent, South Wales .

Vulnerable young people will suffer where need is greatest, as youth charities struggle to keep up with demand during the recession, said Professor Cathy Pharoah, Co-Director, Centre for Charitable Giving and Philanthropy at Cass Business School. The Prince’s Trust alone needs nearly £1 million a week to continue its work. Any loss of investment will have a huge cost to the future of the country.

Martina Milburn, chief executive, The Prince’s Trust said: Britain’s most vulnerable youngsters will be permanently damaged by the downturn, unless they receive the support they need. We need to help young people into jobs only with their ideas and creativity will we be able to pull ourselves out of the recession.

Youth charities struggle to attract funding from the public despite their immeasurable value, according to the report. Animal welfare charities receive five times more donations than charities helping young people .

Youth causes’ income currently represents just 1% of the voluntary sector’s total income of £48 billion, capturing just 1.5% of private voluntary donations .

Charitable trusts’ donations to youth charities would fall by nearly £8 million if funds were to drop by just 3.8% in 2009, as predicted by the International Monetary Fund (IMF) for the UK economy. Nearly a third (30%) of companies expect corporate giving to fall in the recession , putting further pressure on services for disadvantaged young people.

The report coincides with the launch of a major public fundraising campaign from The Prince’s Trust, aiming to raise thousands to help young people into jobs.

The Trust is calling on UK plc to sign up to the Million Makers challenge, raising £1 million to help the next generation of British entrepreneurs. Million Makers will challenge 100 companies to run their own mini-enterprises to raise as much money as possible for The Prince’s Trust.

Calls to The Trust’s helpline at the start of this year increased more than 50 per cent compared with the same period last year, with Business Programme enquiries rising 65 per cent.

About The Prince's Trust

The Prince’s Trust helps change young lives in the UK through practical and financial support, developing skills as well as confidence and motivation.  Since the charity was founded by HRH The Prince of Wales in 1976, it has helped over 600,000 young people across the UK and continues to support 100 more every working day. The youth charity needs to raise around £1 million every week to continue its vital work. Further information about The Prince’s Trust is available at, tel: 0800 842 842.

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Professor Cathy Pharoah, Co-Director, Centre for Charitable Giving and Philanthropy at Cass Business School.

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