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Employers say the return of youth rates gives them the incentive they need to employ inexperienced workers.
Under a new plan announced today, which the government calls a "starting-out wage", young workers can be paid at least 80% of the minimum adult wage.
Employers can use the scheme for:
- 16 and 17 year olds in their first six months with a new employer.
- 18 and 19 year olds starting work after more than six months on a benefit.
- 16 to 19 year olds working in a recognised industry training course involving at least 40 credits a year.
Employers and manufacturer's association employment services manager David Lowe told NBR ONLINE it was fine when youth rates were abolished in 2008 because there were plenty of jobs for anyone who wanted one.
Now employers need an incentive to hire a less experienced worker.
"Young people leaving school with limited qualifications are competing for jobs with experienced older people."
Mr Lowe says while the savings in wages may not offset the issues associated with hiring young and inexperienced workers, it is a "helpful start" for employers.
"There's no silver bullet to this, and everyone who cares about youth unemployment should be celebrating."
The new scheme is due to come into force from April 1, 2013.