Presentation at NICVA's 'Creating the Good Economy' event on 31st January 2014 http://www.nicva.org/news/creating-good-economy-generation-y

1. NICVA
Centre for Economic Empowerment
Economic Conference
Have our youth been jilted or do they just
need to be jolted?
31st January 2014
Richard Ramsey
Chief Economist Northern Ireland
richard.ramsey@ulsterbankcm.com
Twitter @UB_Economics

2. “Yeah, but, no but, yeah but…”

3. Don’t view past generations
through rose tinted spectacles!

4. Jobs
JILTED

5. The current state of the jobs market

6. Slide 6
Northern Ireland’s youth unemployment problems are
small relative to elsewhere
57.7%
36.8%
24.8%59.2%
41.6%
20.1%
7.5%
22.5%

7. Slide 7
The number of under 25s claiming the dole has been higher
NI Youth Claimant Count Levels
<25 years of age
Aug-96
Nov-07
7,050
14,782
0
5,000
10,000
15,000
20,000
25,000
30,000
Dec-95 Dec-97 Dec-99 Dec-01 Dec-03 Dec-05 Dec-07 Dec-09 Dec-11 Dec-13
Source: DFP
19,551 highest level
since October 1996
GFA-98
14,145

8. Slide 8
Youth unemployment in 1980s was probably even higher
NI Unemployment Claimant Count Levels
123,100
59,500
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
Dec-71 Dec-77 Dec-83 Dec-89 Dec-95 Dec-01 Dec-07 Dec-13
Source: DFP
Jan 2013
64,900
Record Low Aug 07
23,500
Good Friday
Agreement signed
April 1998
57,900

9. There are now new ways to earn a living for Generation Y

10. Inward Investment
Infrastructure
Interest Rates
Information
Internet
JILTED

11. Slide 11
Not all decades have been lost! Look at Laganside!
Laganside 1994
Source: Invest NI

12. Source: Invest NI

13. Source: Invest NI

14. Slide 14
3The Bank Rate 1700‐2013
The Bank of England will not keep its bank rate at a
record low forever…implications for young & old

15. Slide 15
Pensioners have been the Jilted Generation as far as
savings rates & pensions (annuity purchase) are concerned
Yield (Interest Rate) on UK 20-Year GILTs
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
Jan-01 Mar-03 May-05 Jul-07 Sep-09 Nov-11 Jan-14
Yield %
Source: Bloomberg
Quantitative Easing (QE)
£375bn

16. Living Conditions
Life Expectancy
Legislation
Lifestyle
Leisure
JILTED

17. Previous generations experienced a totally different
Northern Ireland…..‘they never had it so bad!’

18. Slide 18
And life expectancy is continuing to rise…
Northern Ireland Life Expectancy
78.3
82.4
65
70
75
80
85
90
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
2017
2019
Males Females
Source: ONS

21. Slide 21
% of young adults living with their parents now (36%)
is not markedly different to the late 1990s (33%)
NI adults aged 20-34 years living with parents
20
22
24
26
28
30
32
34
36
38
40
1996-1998 1999-2001 2002-2004 2005-2007 2008-2010 2011-2013
%
80
90
100
110
120
130
140
Nos (k)
% Left Hand Scale Nos (k) Right Hand Scale
Source: ONS

22. Slide 22
First‐Time buyers panicked to get on the property
ladder in 2006/07. Those that didn’t were the lucky ones!
NI Residential Property Prices
Quarterly
80% rise
in 2 years
54%
below peak
50
75
100
125
150
175
200
2005 Q3 2007 Q3 2009 Q3 2011 Q3 2013 Q3
Index Q1 2005 = 100
Source: DFP Residential Property Price Index

23. Slide 23
Could we have tolerated what previous generations did?

24. National Minimum Wage
Fair Employment Legislation
Automatic retirement for females after marriage
Smoking Bans
Sexuality
Legislation we may now take for granted

25. Section 75 & Schedule 9 to the Northern Ireland Act 1998 placed a statutory
obligation on public authorities in carrying out their various functions relating to
Northern Ireland, to have due regard to the need to promote equality of opportunity
between –
• persons of different religious belief, political opinion, racial group, age,
marital status or sexual orientation;
• men and women generally;
• persons with a disability and persons without; and
• between persons with dependants and persons without
Slide 25
Are ‘Jilted Generation’ intergenerational concerns
being adequately addressed under Section 75?

26. Technology
Transport
Tourism
Time
JILTED

27. Technology has moved on…..

28. From Hi‐fi to Wifi the world is a much smaller place..

29. …and more accessible than ever before

30. Slide 30
Recession, inflation & incomes squeeze is deterring
more of our young people from taking to the roads
NI & GB Driving Tests Annual Rolling Total
Index Q3 2008 = 100
-36%
-22%
50
60
70
80
90
100
110
2008 Q3 2009 Q3 2010 Q3 2011 Q3 2012 Q3 2013 Q3
Index
NI GB

31. Entertainment
Emigration
Education
JILTED

32. Slide 32
Emigration has picked up for the younger generation…
Northern Ireland Net Migration Flows for 18-34 Age-Group
-4,500
-3,000
-1,500
0
1,500
3,000
4,500
6,000
7,500
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
International GB
Source: NISRA Increasing Net
Outflows
Increasing Net
Inflows

33. Slide 33
…but was much greater in earlier generations
Northern Ireland Migration Flows
-30,000
-25,000
-20,000
-15,000
-10,000
-5,000
0
5,000
10,000
15,000
1966/67 1975/76 1984/85 1993/94 2002/03 2011/12
Source: NISRA
Increasing Outflows
or Emigration
Increasing Inflows1871-1881 - 15,872 p.a.
1911-1926 - 7,172 p.a
1951-1961 - 9,223 p.a.

34. Slide 34
Education, Education, Education requires
more Money, Money, Money
Northern Ireland Domiciled Students Enrolled at UK
Higher Education Institutions
20
30
40
50
60
70
1993/94 1996/97 1999/00 2002/03 2005/06 2008/09 2011/12
000s
Full-Time Part-Time
Source: HESA
Tuition Fees

35. Debt
Demographics
Debate
JILTED

36. Slide 36
UK Public Sector Net Debt
0
250
500
750
1000
1250
1500
1750
2000
2001-02 2003-04 2005-06 2007-08 2009-10 2011-12 2013-14 2015-16 2017-18
£Bn
Source: ONS, OBR March 2013
One Trillion Pounds of Debt
1.5 Trillion Pounds of Debt
But given where the public finances are heading
changing behaviours are unavoidable… VOTE!

37. Student debt an issue for Generation Y. Older generations
have debt issues too (e.g. endowment mortgage shortfalls)
Income Contingent Repayments for NI Domiciled
Students Studying in Higher Education in UK & EU
0
20
40
60
80
100
120
1999/00 2001/02 2003/04 2005/06 2007/08 2009/10 2011/12
Borrowers (000s)
0
0.2
0.4
0.6
0.8
1
1.2
1.4
Debt (£bn)
No.of Borrowers with Outstanding Debt (000s) Amount of Outstanding Debt (£bn)
Source: The Student Loans Company 2013
Average debt for NI domiciled students
leaving HE in 2012 was £15,690.
*Not all of these students will remain in
or return to Northern Ireland*

38. An ageing population has some advantages. The
Jilted Generation’s revenge on downsizers!
Northern Ireland Population Projections
350
375
400
425
450
475
500
525
550
2012 2016 2020 2024 2028 2032 2036
000s
Population aged in their 30s & 40s Population aged in their 50s & 60s
Source: NISRA

39. Over 65 yrs to increase by 200k (+68%) over the next 24
years. Business opportunities for the younger generations
Northern Ireland's Population & Projections
0
100
200
300
400
500
600
1971 1977 1983 1989 1995 2001 2007 2013 2019 2025 2031 2037
000s
Aged <16 years of age Aged 65+ years of age
Source: NISRA

40. 1. Commitment to sustainable public finance decisions (incl. pensions)
2. Transparency of costs & benefits of PE across intergenerational lines
3. Introduce intergenerational impact into decision making & planning
• E.g. an equitable water charge that doesn’t defer costs to next generation
4. Raise the free public transport for >60s to >65 years & add restrictions
5. Promote career downsizing options in public sector for the benefit of youth
6. Credible long‐term funding plans for capital investment & house building
7. Lobby BBC to have a weekly business / economics equivalent of ‘The View’
8. Greater public sector pay flexibility to protect jobs
9. Target persistent public sector underperformance (employees)
• Blocks opportunities for the younger generation
10. Reduce incentives / vary taxes for BTL (Buy‐to‐Let) & KTL (Keep‐to‐Let)
Club 18‐34 Jilted Generation Election Pledge Card
Things can only get better

41. In ‘Ferris Bueller’s Day Off’ Ferris discovered
you can’t wind back the clock!

42. Remember don’t take life too seriously &
heed Ferris’s advice!
“Life moves pretty fast. If you don’t stop and look
around every once in a while, you could miss it”.
DON’T YOU MISS IT!

43. Slide 43
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