S/E/16. Is the New Deal for Youth proving a successful way of reducing unemployment? If so, is it likely the New Deal will have long term consequences on an unemployed person's subsequent employment and wage outcomes?

This first part of this essay will aim to analyse whether the New Deal for Youth is proving successful in reducing unemployment. There has been a wide range of research projects devoted to answering this question. Unfortunately, though the question seems simple, the answer is not. The analysis will than move to investigate the long-term effects of this deal on an unemployed person's subsequent employment and wages. Again, this is no simple task despite the various studies done on the topic. The difficulty in answering these questions arises from the fact that the NDYP is still in its early days. It is therefore difficult to assess its full implications given how important macroeconomic shocks can be in the determination of employment. It is also debated whether a deal so skewed towards youth (18-23), will adversely affect the employment and/or earnings of other members of the labour force.