A NEW billion pound scheme to tackle youth unemployment has been welcomed by city organisations.

Plymouth Employment and Skills Board (ESB), City College Plymouth and the Wolseley Trust see the Youth Contract as a positive step in the fight against rising levels of young people out of work.

Deputy Prime Minister Nick Clegg announced the £1billion programme recently, which will provide 410,000 private sector work places for 18 to 24-year-olds, with wage subsidies worth £2,275 handed to employers to take on 160,000 young people.

The funds, to be spent over three years, will also create additional work experience places and £50 million will be spent on helping 16 and 17 year olds into training.

Figures for October show there are 2,495 18 to 24 year-olds claiming the dole in Plymouth. This is 375 up on the same month last year.

"We welcome any investment in our young people who have been hit disproportionately by the economic downturn," said Graham Stirling, Chair of Plymouth ESB.

And he added that the city can draw on the experience of the Labour government's Future Jobs Fund, which provided training and employment support for young people within public sector work placements.

"I think schemes like this are vital," said Peter Flukes, chief executive of the Wolseley Trust which spearheaded the Plymouth Future Jobs Fund.

"I am glad there will be a youth programme and focus again on young people's unemployment and training needs."

He added that he believed a scheme that brought together employers from the public and private sectors would give even better results.

During the Future Jobs Fund programme, the Wolseley Trust and around 40 organisations worked together to support 373 unemployed local people. Mr Flukes said that of these, around 100 found work during or shortly after taking part in the scheme.

And he added that there were similarities between the two initiatives.

"We looked at the money that government would pay us to employ people and see how we could maximise their training and skills enhancement," he said. "And it looks like this approach is very much a feature of the new programme as well."

The spotlight will also be thrown on apprenticeships, with cash payments of £1,500 available for employers taking on young people in this role.

"Whilst any investment in engaging the young people of the country and offering them an opportunity of genuine work experience is good news we need to make sure this is not a quick fix," said Steve Murphy, operations manager at City College Plymouth and member of the work-based learning department.

"Young people need to know these opportunities really could help them into employment or further training and secure them a long term future."

The Youth Contract programme is due to begin next year.