Over 1 million young people are projected to be out of work within five years, according to a new report set to be released this morning. The number of 16 to 24-year-olds not in employment, education or training (NEET) is expected to rise to 1.25 million by 2031 unless urgent action is taken, the major review warns.
The report's author, former minister Alan Milburn, will say that the education, health and welfare systems are "no longer fit for purpose" in preparing young people for adult life. In a speech later today, he is expected to state: "We are at risk of a lost generation. The first rung of the career ladder has thinned, and for too many young people it is now simply out of reach."
Milburn will highlight a "hopeless catch-22" where employers demand work experience but opportunities for young people to gain it have narrowed or disappeared. Latest figures show the unemployment rate for 16 to 24-year-olds stands at 16.2%, the highest since 2014 and more than three times the overall rate of 5%.
Businesses cutting back and AI impact
Experts say businesses are cutting back on staff, particularly young people, and this is reflected in the statistics. The rise of artificial intelligence is reducing entry-level jobs, creating a challenge that the government must address.
Lukas Kaminskis, CEO of edtech platform Turing College, described the situation as a "skills emergency" rather than just a labour market issue. He said: "We're seeing a growing disconnect between what traditional education pathways provide and what employers increasingly need - particularly in fast-growing, digital-first sectors where practical, job-ready skills matter as much as qualifications."
Kaminskis called for a stronger focus on flexible, skills-based learning models that allow people to build relevant capabilities quickly and gain hands-on experience. "The challenge for policymakers and employers is not just creating jobs, but rebuilding confidence that there are accessible pathways into meaningful careers," he added.
Human cost behind the statistics
Kate Underwood, Founder and Chief People Strategist at Kate Underwood HR and Training, emphasised the human impact. "Behind every statistic in this report is a teenager checking their phone for a job reply that isn't coming. A 'lost generation' isn't just a soundbite; it's someone's child, sitting at the kitchen table, slowly losing belief in themselves."
She noted that small business owners would like to hire young talent but face challenges such as NI hikes, rising wages and shrinking margins. "You can't hand-hold a 17-year-old through their first job when you're doing payroll at midnight. And we keep asking young people to gain experience that nobody will give them. It's the cruellest catch-22 going."
Underwood highlighted the role of charities like Safe New Futures, which help young people find their footing when other systems have let them down. "They shouldn't be filling a gap this big alone, but thank god they're filling it at all," she said.
