Young people in the UK not currently in work, training, or education are costing the country £125 billion each year. A recent review found that individuals aged 16 to 24 face a "perfect storm" of difficulties. This situation puts the UK at risk of a "lost generation" if no immediate steps are taken.
The report indicates that one in six young people could be unemployed or out of training by 2031. Opportunities for young people are shrinking rather than growing. This comes as official figures show over one million young people are not in education, employment, or training. This figure is the highest it has been in over 12 years.
This crisis fits into a broader concern about the UK's economic future. The number of available entry-level jobs has dropped significantly. Over the past two decades, mid- and lower-skilled jobs have fallen by an estimated 1.6 million. This decline affects the earning potential and tax contributions of a significant portion of the population.
Alan Milburn, the former minister who led the review, stated that the current education, health, and welfare systems are not adequately preparing young people for adult life. He warned of a potential "lost generation" if significant action is not taken soon. The report is based on data from the Office for National Statistics (ONS).
The estimated £125 billion annual cost includes £38 billion in lost economic potential. Another £63 billion is lost due to "economic scarring," meaning these young people are less likely to work in the future. The total figure also accounts for lost tax revenue and increased spending on health and benefits. This sum exceeds the UK's annual education spending.
Work and Pensions Secretary Pat McFadden acknowledged the scale of the challenge. He stated that the government is introducing reforms to create 500,000 new opportunities for young people. These include a Youth Jobs Grant and more apprenticeships. However, shadow work and pensions secretary Helen Whately criticized current government policies.
Factors contributing to this problem are complex. The Covid-19 pandemic and the current job market play a role. The report also notes a sharp increase in young people reporting anxiety and ADHD. These conditions impact their ability to secure and maintain employment or training.
The review challenges the idea that young people are unwilling to work. Milburn stated that many are actively applying for hundreds of jobs monthly with no response. "The silence that kills" is how he described the lack of feedback. For many, the traditional contract where effort leads to reward has been broken.
The report also highlights systemic issues. "Doomscrolling" and isolation are cited as contributing factors to a "bedroom generation." One young person shared how lockdown affected social skills crucial for employment. These skills include eye contact and non-verbal communication. The report stresses that institutions designed to help young people are no longer fit for purpose.