- 981,000 young people in the UK not in work, education or training
- UK youth unemployment at 15.6 per cent, compared with 3.4 per cent for older workers
- Milburn to propose curbing sickness benefits for under-25s
- AI blamed for a “silent hiring freeze” on junior roles
FAISA QAMAR applied for more than 500 jobs and got nowhere, an experience she likened to “shouting into the void”. A 10-week training course tailored to the green energy sector finally landed her a job within a month.
The government hopes to replicate her story on a much larger scale. Next week, it will receive proposals that would restrict sickness and disability benefits for young people to fund back-to-work schemes for the nearly one million 16- to 24-year-olds not in employment, education or training (NEET).
Britain had 981,000 NEETs in the second quarter of this year, 13 per cent of the age group, and last year its NEET rate was the second highest in Europe.
Youth unemployment hits twelve-year high, review finds
The UK’s youth unemployment rate of 15.6 per cent is also unusually high compared with 3.4 per cent for older workers. Elsewhere in Europe, youth unemployment is typically only just over double the rate for older age groups.
‘It could mean less financial support’
Former minister Alan Milburn, who is leading the government-commissioned review, warned in May of a “lost generation”.
Next week he will propose barring under-25s from ill-health supplements to unemployment benefits and moving them on to a more restricted version of the main disability benefit.
“I’m not saying that any of this will be easy, or that it will be pain-free,” Milburn told The Times. “Candidly, it could mean that some people will get less financial support.”
He has said he wants to shift the 25-to-1 ratio of spending on benefits versus employment support towards the latter, drawing on lessons from countries such as the Netherlands.
The proposals are unlikely to quickly reduce the £8 billion a year spent on benefits for young people, and cuts could prove unpopular with Labour MPs, who blocked previous prime minister Keir Starmer’s attempts to cut welfare.
What works
Michael Houlihan, UK head of employment charity Generation, said about 70 per cent of people on its courses found work within 12 months, double the average for similar schemes, because training is tailored to employers with vacancies.
Omar, now 27, attended a Generation course in 2023.
UK unemployment rises to five per cent
“Before Generation I had the drive but I didn’t have the map,” she said. “Climate change was one of my passions, but I didn’t know how to ... find an accessible path into the green sector.”
AI and the ‘silent hiring freeze’
James Tuttiett of IT consultancy FDM Group said artificial intelligence had reduced demand for junior staff.
“You have this silent hiring freeze where AI can increasingly do a lot of jobs that exist in white-collar work,” he said, adding that a higher minimum wage and increased employer National Insurance contributions had also limited hiring.
Lessons from abroad
Nye Cominetti, an economist at the Resolution Foundation, said UK benefits were not unusually generous compared with European countries with fewer NEETs, but young people on health-related benefits in Britain faced fewer requirements to look for work.
In Utrecht, officials knock on the doors of young people out of work or education to offer help such as childcare or mental health support, said Sonja Bekker, a professor at Utrecht University. Two-thirds of Dutch 16- and 17-year-olds have part-time jobs, compared with fewer than a fifth in Britain.
Even in the Netherlands, though, NEET numbers have started to rise.
(With inputs from Reuters)
