A growing number of young people in Britain are facing significant barriers to employment, with experts urging government intervention to make it easier and more affordable for employers to hire younger workers. The rising number of individuals not in education, employment, or training (NEET) has prompted calls for the Chancellor of the Exchequer, John Healey, to address youth worklessness in his upcoming Budget.
Recent evidence highlights the scale of the issue. According to the Centre for Social Justice, around one in three 15-year-olds report rarely leaving their bedrooms except to attend school. This pattern is often linked to loneliness and mental health difficulties, leaving many young people vulnerable to becoming NEET. Currently, approximately one million young people in the UK fall into this category, reflecting a broader social and economic challenge. Employment charities report that even low-skilled jobs can provide valuable structure and social engagement for young people struggling with isolation and anxiety.
Several business leaders have expressed concerns over hiring costs, which they say are discouraging firms from taking on young or inexperienced staff. The National Insurance contributions (NICs) introduced in the 2024 Budget, which increased payroll taxes for employers, have been criticized for contributing to hiring freezes and job cuts, particularly in sectors that typically employ large numbers of young workers, such as retail and hospitality. The finance director of Greene King recently stated that the pub chain now employs 20% fewer 16 to 20-year-olds than before the NICs increase.
Industry advocates and recruitment experts suggest that reducing or exempting NICs for workers under 25 could incentivize firms to hire more young people. Proposals also include introducing a NIC holiday for smaller businesses that take on NEET individuals, and discussions around adjusting tax policies in response to increasing automation. Retail and hospitality representatives have called on the government to reverse some of the previous tax increases and offer more support to boost youth employment opportunities.
The Government has pledged to support youth employment, including a recent commitment to help the hospitality sector hire 100,000 NEETs over the next three years. However, some industry insiders view this as only one part of a wider need for fiscal changes, describing the government’s promise as a “down payment on trust.” According to research by Hilton and WPI Economics, moving a single NEET into employment can generate £152,000 in economic value annually, not including the lifelong benefits of early work experience in building transferable soft skills.
John Healey has acknowledged the link between employment costs and youth unemployment in interviews ahead of the Budget, but businesses and advocates stress the need for concrete measures. The British Chambers of Commerce recently identified labour costs as the primary concern for most businesses, underscoring the potential impact of any changes to hiring taxes.
With youth unemployment contributing an estimated £125 billion annually in social and economic costs, experts emphasize that addressing barriers to hiring young workers is critical to breaking the cycle of worklessness and isolation facing Britain’s younger generations. As the government prepares its Budget, attention will focus on whether steps will be taken to lower costs for employers and expand opportunities for the country’s "bedroom generation."