Employers in Great Britain will receive £3,000 for every long-term unemployed young person they hire under a new government scheme aimed at reducing the welfare bill and tackling youth joblessness. The initiative, launching on Tuesday, targets 60,000 people aged 18-24 over three years.
Firms in England, Scotland and Wales can access the grant if they take on an eligible young person who has been out of work for six months or more. The scheme is part of Labour's response to a crisis that has seen the UK's NEET rate (not in employment, education or training) rise to among the highest in the EU, with only Romania faring worse.
A government-commissioned report by former minister Alan Milburn found that 1 million 16- to 24-year-olds – about one in eight – are NEET, costing the economy over £125bn annually. The report highlighted regional disparities, with NEET rates ranging from 1% in Barnet, north London, to 21.5% in Dudley, West Midlands.
Prime Minister Keir Starmer and Work and Pensions Secretary Pat McFadden will host a roundtable with hospitality businesses on Monday. Merlin Entertainments, owner of Legoland Windsor and Alton Towers, is the first backer, pledging 300 jobs over three years. Starmer said the scheme is 'the foundation for a new contract with the next generation'.
Critics, including opposition leaders and business groups, argue that Labour's policies – such as increased employer national insurance and a rising minimum wage – have worsened the youth jobs crisis. The Trades Union Congress welcomed the move but urged the government to 'go further and faster' with its jobs guarantee scheme.
