Companies are to be paid grants to hire more young people under new government proposals to tackle youth unemployment.
Businesses will receive £3,000 for every person aged 18 to 24 they employ who has been searching for work for six months or more. Small and medium-sized firms will also receive £2,000 for each new apprentice they hire.
The measures come as concerns grow about the number of young people not currently in education, employment or training (NEETs).
In the final quarter of 2025, the number of young people in this category approached one million.
Commenting on the proposals Ben Harrison, Director of the Work Foundation at Lancaster University said:
The new Youth Jobs Grant has the potential to improve on previous proposals that limited sustained support to 18-21 year olds who had been out of work for over 18 months.
“With nearly a million young people out of education, employment or training, and vacancies having fallen sharply since the pandemic, these new grants for businesses could help incentivise them to employ 18-24 year olds before they slip into long term unemployment.
“But in a challenging labour market, Ministers should ensure interventions are focussed on the needs of young people, as well as the sectors and local economies that require the support most.
“For this new plan to truly support 60,000 young people, the Government must guarantee that grants are only available for businesses that provide secure work, fair pay and roles that offer progression for the future. Research shows that any job isn’t always better than no job.
“If these new grants simply subsidise businesses to offer low quality jobs, they will risk exacerbating one of the key challenges keeping young people out of the labour market in the first place. Young people are already twice as likely to find themselves in a severely insecure job than older workers. Alongside poor pay and limited progression, insecure work can deepen existing physical and mental health challenges, and mean some young people remain reliant on the welfare system for the long term.”
