Chancellor Rachel Reeves is facing intense criticism over new measures that subsidise foreign workers while British youth unemployment hits a 12-year high. The government is offering UK businesses £5,000 per overseas recruit, covering visa costs and fast-tracking applications, primarily in technology, life sciences, and clean energy sectors.
Unemployment Crisis Deepens
Since Reeves' maiden Budget in October 2024, unemployment has risen from 4.1% to 5%, with forecasts of 200,000 job losses this year. Youth unemployment has surged to 14.7%, the highest in over a decade. The number of 16 to 24-year-olds not in education, employment, or training (Neets) is projected to hit 1.25 million.
Government jobs czar Alan Milburn described this as the worst worklessness crisis in 25 years. Critics argue that Reeves' policies, including a £25 billion hike in employers' National Insurance and two inflation-busting minimum wage increases, have discouraged hiring, particularly of young people.
Immigration and Employment
Research by the Centre for Social Justice reveals that employers are hiring 27 young workers from outside the EU for every British youngster. HMRC data shows the number of non-EU foreign nationals under 25 in employment jumped from 81,500 in January 2020 to 370,900 by December 2025. Reeves' new subsidy further incentivises overseas recruitment.
Even Labour's Milburn has warned that cheap foreign labour is replacing British talent. The chancellor's Youth Guarantee scheme, promising work, training, or education, is seen as a taxpayer-funded rescue operation for problems she created.
Critics argue that private sector job creation is stifled by government intervention, and state-run schemes burn money without delivering results. The combination of high youth unemployment and subsidised foreign hiring has sparked outrage, with many questioning the chancellor's economic strategy.
