The answer to unemployment is reindustrialisation, not cutting benefits

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It promises not to impose “crude cuts” to social security, though Milburn’s advance briefings have focused on such cuts to two forms of sickness benefit (the health element of Universal Credit and the Personal Independence Payment).

No-one on the left has high hopes of Milburn, a Blair-era minister associated with NHS marketisation and a child poverty and social mobility adviser to the David Cameron government, under which child poverty and inequality rose.

But the real problem is that his remit only looks at a symptom — the large number of young people not in education, employment or training (the so-called Neets) — rather than the underlying cause in Britain’s stagnant economy.

Successive governments have taken an axe to social security. The Cameron-Osborne government demonised the disabled as “shirkers” and introduced humiliating and inaccurate “fit for work” tests outsourced to companies which set targets for how many people to fail.

Thousands of people died within six months of being declared “fit for work” and some even starved to death after their benefits were cut, a watershed in Britain’s descent into Thatcherite barbarism. But for all that welfare spending has not significantly reduced (nor, despite media scaremongering, is it at historic highs: currently at about 10.7 per cent of GDP, compared to 10 per cent in 2008 or 12.3 per cent in 2013).

The Tory approach to “making work pay,” which never involved making work pay more but rather made the lack of it more unpleasant, has demonstrably been as useless as it is cruel.

Solutions to large-scale unemployment (which, we should remember given Burnham’s pledge to undo 40 years of neoliberalism, is a post-Thatcher constant of the British economy) cannot lie in the benefits system when there are currently 2.5 unemployed people for every job vacancy and employers receive 140 applications for every graduate post advertised.

Rather Britain suffers from long-term underinvestment, both by private capital and the state.

Our tax system incentivises rent-seeking and property speculation over productive investment, which is also discouraged by fragmented, expensive and unpredictable transport and energy systems.

State-led investment remains restricted by Treasury orthodoxy opposing strategic interventions in the economy and public ownership. Where it occurs it often involves guaranteeing private profits without securing the kind of public control that could ensure investment is tied to job creation or long-term industrial development.

The result is a deindustrialised economy characterised by low wages, low productivity and stubbornly high unemployment.

Two things are clear: one, a look at the youth revolt taking place across Europe show the same long-term problems exist across the continent and those who believe reversing Brexit will fix the problem are away with the fairies.

Two, the unfolding AI revolution will make all these problems much worse unless we have a strategy to reshape the economy and upskill and retrain workers.

Much of the trade union movement understands the problem and the necessary solution, the state-led reindustrialisation of the country.

This forms the basis of Reindustrialise Britain, an invaluable book outlining the policies needed with a forward by three trade union general secretaries; the same concerns informed the TUC’s resolution on reindustrialisation passed in September.

But such policies were completely absent from last month’s Budget and there is no reason to expect them in next year’s Spending Review unless pressure for a change in direction is applied before then.

A project for an alternative economic and political strategy can generate mass enthusiasm: we saw this in the response to Labour’s 2017 manifesto. The labour movement must work out how, in the absence of a socialist-led Labour Party, it can win a mass audience for the policies needed and turn that into public pressure on MPs.

Voices of Scotland / 10 November 2026 Zombie Blairites can’t fix the youth unemployment crisis 10 November 2026 Labour continues to fail young working-class people in jobs and education yet shifts the blame on to them. SEAN O’NEILL suggests the trade union movement needs to champion their cause by promoting investment in infrastructure jobs

Britain / 19 October 2026 ‘Answer to youth unemployment is not cut benefits and any job available,’ Burnham told 19 October 2026 Young adults need a realistic chance to build a future not just a foot on the career ladder, PCS's Fran Heathcote says