Young people facing shrinking opportunities
Young people in the UK who are out of work, training or education are facing a “perfect storm” of challenges, according to a major new review warning that the country risks creating a “lost generation”.
The report’s author, former minister Alan Milburn, said the education, health and welfare systems were no longer fit for purpose in preparing young people for adult life.
“We are at risk of a lost generation,” he warned, with one in six 16 to 24-year-olds projected to be out of work, education or training by 2031 unless “urgent” action is taken.
“The problem is that for too many young people, opportunities are not growing, they’re shrinking,” Milburn said.
More than one million young people affected
The report comes amid growing concern over the number of young people struggling to secure jobs in the UK.
Official figures released on Thursday showed more than one million young people were not in education, employment or training — the highest level in more than 12 years.
“This is a visceral feeling in the country… it’s bordering on a fear among parents and grandparents that this generation is going to be a lost generation,” Milburn told the BBC.
Milburn was tasked with investigating why so many young people are not in employment, education or training, often referred to as Neets.
The interim report does not yet include proposed solutions, which will be presented in a final report at a later stage.
A grim picture for young people
The review paints a bleak picture for many young people across the UK:
- Six in 10 Neets have never had a job, compared with four in 10 in 2005.
- However, 84% of Neet young people surveyed said they wanted a job or training opportunity.
- Between January and March 2026, 1,012,000 young people were classified as Neet, accounting for 13.5% of all young people in the UK, according to the Office for National Statistics (ONS).
- Around 613,000 young people were considered economically inactive, meaning they were not looking or available for work.
- An estimated 400,000 young people were unemployed but actively seeking work.
- Entry-level jobs have sharply declined, with around 1.6 million mid- and lower-skilled jobs disappearing over the past 20 years.
- Vacancies in hospitality have halved in the last four years.
Milburn’s report estimated the overall economic impact of almost one million Neet young people at £125bn annually, including lost economic potential, reduced future earnings, lower tax revenue and increased health and welfare spending.
Young people reject ‘lazy generation’ narrative
Milburn challenged stereotypes suggesting young people simply do not want to work.
“You hear some call them work shy, snowflakes, soft — this is a generation that is trying, putting in hundreds of applications a month,” he told the BBC.
“They hear nothing back, it’s the silence that kills. The old contract in society was always you put in effort and got a reward, each generation would do better than the last — this contract has been broken for this generation.”
He also pointed to worsening mental health as a major factor, with rising numbers of young people reporting anxiety and ADHD among the reasons they were unable to work or train.
Systemic failures, he argued, were contributing to the emergence of a “bedroom generation” isolated behind screens and disconnected from society.
Covid and social isolation blamed
The report included testimony from young people describing the lasting impact of Covid lockdowns.
“We weren’t really seeing people in person, so we didn’t get used to the social aspect of connecting with people,” one young person said.
“Maintaining eye contact, hand gestures and all sorts. We were just sitting behind screens. There were skills that people were struggling to develop.”
Zaynah, 24, said she had suffered from physical ill health and had not worked since leaving college.
Over the past year, she applied for more than 200 jobs without hearing back from employers.
“Getting a job is very hard because with my issues, I haven’t got that much experience, I’ve never worked before,” she said.
“So I feel like it’s restricting me and I’m not getting jobs.”
She said she planned to begin volunteering to improve her CV.
Luke, who studied product design at university, said he had applied for more than 400 jobs and secured only one interview.
“It’s humiliating,” the 23-year-old said.
“You think ‘okay I’ve got all the knowledge, I’ve got all the skills, all I’m waiting for is a job to put it in practice’.
“It makes you depressed, especially the amount of rejections.”
Government and businesses under pressure
Work and Pensions Secretary Pat McFadden said the review exposed “the scale of the challenge and the root causes of youth unemployment”.
He said the government was introducing reforms aimed at creating 500,000 opportunities for young people, including apprenticeships, subsidised employment and a Youth Jobs Grant for businesses.
However, shadow work and pensions secretary Helen Whately criticised the government’s approach, claiming Labour had made it harder for young people to enter the workforce.
Milburn said the UK’s youth unemployment crisis was significantly worse than in comparable countries, with rates three times higher than in the Netherlands and double those of Ireland.
The report noted that sectors such as retail and hospitality — traditionally entry points for young workers — had seen major declines in vacancies.
Some employers argued rising minimum wages and increased taxes, including employer National Insurance contributions, had made it harder to hire young people.
The boss of Next, Lord Simon Wolfson, said the retailer used to receive around 10 applications per vacancy two years ago, but now receives 19.
David Fox, founder of the Tampopo restaurant chain, said inflation and rising employment costs were limiting his ability to hire more young workers.
Stories of recovery and opportunity
The report also highlighted examples of young people eventually finding stability after long periods out of work.
Rocky had been unemployed for a year before joining Nando’s as a waiter. Three years later, he is now an assistant manager.
“I’m 23 years old and I’m a manager at Nando’s,” he said.
“I feel happy with myself. I can look back and tell my doubters that I made it.”
High street retailers and hospitality businesses such as restaurants, cafes and pubs often offer the first experience of work for many young people.
Some employers have argued it has become more difficult to hire young people due to higher minimum wages and increased taxes, such as employer National Insurance contributions.
The boss of Next, Lord Simon Wolfson, told the BBC this week that just two years ago, the retail giant typically received 10 applications for every shop vacancy, but that number had since risen to 19.
David Fox, founder of the Tampopo restaurant chain, said inflation and the costs of employing workers such as National Insurance increases and higher minimum wages were preventing him from hiring more young people.
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