Young people face shrinking job and career opportunities, with one in six at risk of being out of work, education or training within five years unless action is taken, a major review has warned.
The review, led by former minister Alan Milburn, said the systems designed to prepare young people for adult life are no longer working properly. It found that education, health and welfare support are failing to keep pace with the challenges facing young adults.
Its findings come as official figures show more than one million young people are now not in education, employment or training, often referred to as NEETs. That is the highest level in more than 12 years and has added to concern about the state of the UK jobs market for younger workers.
According to the Office for National Statistics, 1,012,000 young people were classed as NEET between January and March 2026. This represented 13.5% of all young people in the UK.
Young people want work
The report challenges the notion that young people are not seeking work. It said rejection has become a normal experience for many young job seekers, even after sending dozens or hundreds of applications.
Six in 10 young people who are NEET have never had a job, compared with four in 10 in 2005. However, the report also found that 84% of young people in this group want a job or training.
Around 613,000 young people were classed as economically inactive, meaning they were neither looking for work nor available to work. A further 400,000 were unemployed, meaning they were not in work but were actively seeking a job.
The review said the problem is not caused by one single factor. Instead, it points to a mix of issues, including the lasting effects of the Covid pandemic, poorer mental health, smartphone use and a changing jobs market.
Entry-level work has fallen
One of the biggest concerns is the decline in entry-level roles. The report said the number of mid-skilled and lower-skilled jobs in the economy has fallen by around 1.6 million over the past 20 years.
Vacancies in hospitality, a sector that often gives young people their first experience of work, have halved in the last four years, according to ONS data. Retail, cafés, pubs and restaurants have traditionally provided early work opportunities, but those routes have become more limited.
Some employers have blamed higher minimum wages and increased costs, including employer National Insurance contributions, for making it harder to hire young people. However, the Institute for Fiscal Studies has said there is no clear evidence that higher minimum wages have been a major driver of the rise in the number of young people becoming NEET. It also noted that most 18- to 20-year-olds are largely exempt from employer National Insurance contributions.
Milburn’s review also found no evidence of a link between migration and youth joblessness.
The economic cost is significant. The review estimated that almost one million young people being out of work, education or training costs the UK economy £125 billion a year. This includes lost output, lower future earnings, reduced tax revenue, higher benefits spending and extra pressure on health services.
Government faces pressure to respond
Prime Minister Keir Starmer described the report as sobering and said the Government would work with Milburn on what more needed to be done.
Work and Pensions Secretary Pat McFadden said the review showed the scale of the challenge and the root causes of youth unemployment. He said the Government was already bringing forward youth employment reforms, including a Youth Jobs Grant for businesses, more apprenticeships and subsidised employment.
Opposition parties criticised the Government’s approach. Shadow work and pensions secretary Helen Whately said Labour had made it harder for young people to take their first step into work. Liberal Democrat Treasury spokesperson Daisy Cooper said her party had warned that higher employment costs would reduce job opportunities.
Milburn said the country risks seeing a generation lose faith in the promise that effort leads to reward. He warned that too many young people now face fewer opportunities, weaker support and a harder route into adult working life.
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