Coming of age during a downturn can cause scarring – and it takes up to a decade to heal

a post by Stephen Clarke for the Resolution Foundation blog

Recessions are bad for people’s standard of living. And they’re particularly bad for young people. That’s the painful lesson we learnt after the 1980s recession where, for most of that decade, at least one in seven people under 30 were unemployed.

We know a lot about the unemployment scarring of the 1980s – from the rich academic literature, to UB40 or Shane Meadows’ This is England. But we’re only now beginning to learn what kind of long-term impacts the last big recession has had on young people.

While there’s never a good time to experience a recession, it’s particularly unlucky to come of age during one. What that bad luck means in terms of how much you earn, or what job you do, is something the Resolution Foundation has explored by looking at the ‘crisis cohort’ who left school, college or university between 2008 and 2011.

First, the good news. Although the recent downturn was far bigger than the 80s and early 90s recessions, it didn’t spur the big spike in youth unemployment that many feared. The recovery was quick, and Britain returned to record employment by early 2015. Instead, the pain of the recession was shared across more young people, through a deep pay squeeze. Now the biggest pay squeeze since the Napoleonic Wars isn’t pretty. But spreading the pain of a recession through everyone’s pay packets is certainly much fairer than concentrating the pain on those joining the dole queues, as occurred in the 1980s.

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