One in six young people set to be out of work, education or training within five years without intervention, review finds

A major review led by former Labour minister Alan Milburn has found that job and career opportunities for young people are “not growing, they’re shrinking,” warning that one in six could be out of work, education or training within five years unless action is taken. The report, released on Thursday, concludes that the education, health and welfare systems are no longer fit for purpose in preparing young adults for adult life. “We are at risk of a lost generation,” Milburn said, describing young adults as facing a “perfect storm” of challenges.

The review coincides with official figures showing that more than one million young people in the UK are not in education, employment or training — the highest level in more than 12 years. The data has intensified concerns over the inability of many young Britons to secure jobs. Milburn challenged the characterisation that young people are “work shy, snowflakes, soft,” saying that rejections after dozens or even hundreds of applications have become the norm. “The problem is that for too many young people, opportunities are not growing, they’re shrinking,” he said. “You put in an application dozens at a time, you hear nothing back, you just get rejected.”

Scope of the crisis

Milburn was tasked with investigating why so many young people are not in employment, education or training — a group known by the acronym Neets (not in education, employment or training). His interim report, released on Thursday, does not include solutions, which will be presented in a final report at a later date. “This is a visceral feeling in the country… it’s bordering on a fear in the country among parents and grandparents that this generation is going to be a lost generation,” Milburn said. “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.”

The review, along with other statistics, paints a grim picture for young people in the UK:

• Six in 10 Neets have never had a job. In 2005, this was four in 10, the report says.
• 84% of Neet young people surveyed want a job or training, it adds.
• There were 1,012,000 young people classed as Neet between January and March 2026, making up 13.5% of all young people in the UK, according to the Office for National Statistics (ONS).
• The number of people classed as “economically inactive” — not looking or available to work — rose to about 613,000.
• The number of young people classed as unemployed — not in work but seeking a job — was estimated to be 400,000.

Decline in entry-level jobs

Entry-level jobs have sharply declined, with the number of mid- and lower-skilled jobs in the economy falling by around 1.6 million over the past 20 years. Vacancies in hospitality have halved in the last four years alone, according to ONS data. The cumulative cost of almost one million Neet young people to the UK economy has been estimated at £125bn per year, according to the review. That includes £38bn a year in lost economic potential, and £63bn a year lost due to economic “scarring,” as they are less likely to work in the future. It also includes losses in tax revenue, and increased health and benefits spending. The total estimated cost exceeds annual education spending in England.

Government response

Prime Minister Keir Starmer called the report “sobering” and said he would work with Milburn “on what more needs to be done” to tackle the problems. Work and Pensions Secretary Pat McFadden said the review laid “bare the scale of the challenge and the root causes of youth unemployment we now need to confront.” He added: “We are already taking action by bringing forward the biggest youth employment reforms in a generation to create 500,000 opportunities for young people, including a Youth Jobs Grant for bus…”

Context

The warning echoes findings from a 2023 report by the Resolution Foundation, which found that young people in the UK were increasingly locked out of the labour market due to a decline in entry-level roles and a rise in long-term sickness. Similarly, a 2024 analysis by the Institute for Fiscal Studies noted that the share of 16- to 24-year-olds not in work or study had risen steadily since 2019, with the pandemic accelerating existing structural trends in the youth labour market.