By Shevaun Haviland, Director General of the British Chambers of Commerce and Rt Hon Baroness Smith of Malvern, Minister for Skills
Over a million young people in the UK are not in education, employment, or training (NEET). That’s not just a social crisis – it’s an economic one. Every day this talent drifts further from the workplace, businesses lose out and the skills gaps widen.=
Research shows that if young people can’t get a start in work or training, it gets harder for them to engage. It is a worrying social issue, but also a pressing economic risk.
What is the Government doing to support young people into work?
The Government is determined to support more young people into work. That is why it investing an additional £2.5 billion into the Youth Guarantee and Growth and Skills Levy over the next three years.
This investment will ensure employers are equipped with the funding and tools required to create opportunities for young people and ensure each young person has a chance to reach their full potential. As part of the Youth Guarantee, from this summer, a £3000 incentive payment will be available to every employer in Great Britain who hires an eligible young person. Whilst further investment in the Growth and Skills Levy will enable non-levy paying employers in England recruiting an apprentice aged 16-24 to receive a £2000 incentive. This is on top of the Government’s previous commitment to fully fund apprenticeships for 16-24-year-olds for non-levy payers from August 2026, making it easier for an employer to take on young talent.
Both the Government and the BCC recognise the importance of tackling the declining number of young people taking up apprenticeships both to ensure young people have access to skilled work and to ensure employers have a pipeline of skilled talent. This is why as part of investment into the Growth and Skills Levy, the Government is launching Foundation Apprenticeships into the hospitality and retail sectors, introducing additional Level 2 apprenticeship standards, and the launch of the first apprenticeship units to help employers upskill their workforces and address skills gaps more flexibly, with the initial ten units launching from April 2026—covering AI leadership- strategy and opportunity, AI leadership- AI adoption, procurement and governance, AI leadership- AI delivery and organisational transformation, electric vehicle charging point installation and maintenance, electrical fitting and assembly, mechanical fitting and assembly, permanent modular building assembly, solar PV installation and maintenance, welding, and battery manufacturing.
This follows on from the previously announced £140 million pilot for local Mayors to be able to connect young people, especially those who are NEET, with thousands of apprenticeship opportunities at local employers. These pilots will include testing approaches to offering local apprenticeship opportunities to those who have applied but missed out on previous applications.
The Government is also introducing a Jobs Guarantee. This will provide any young person aged between 18-24-years old who has been on Universal Credit looking for work for over 18 months with a fully funded six month guaranteed paid employment opportunity with additional mentoring, support, and training, breaking the cycle of long-term unemployment. Phase one of this scheme will soon be rolled out to eligible 18-21-year-olds across six areas of the country: Birmingham and Solihull, East Midlands, Greater Manchester, Hertfordshire and Essex, Central and East Scotland, and Southwest and Southeast Wales, followed by national roll out later this year for those aged between 18-24-years old.
The Youth Guarantee will also provide almost 500,000 opportunities for work and training places for young people, providing an opportunity for employers to work with the DWP to shape training and work experience programmes to meet skills needs, as well as an opportunity for employers to get to know young people before hiring.
But the Youth Guarantee will continue to adapt to the demands and needs of young people. This is why the Department has sought to understand wider employment barriers that young people face to employment, through an investigation led by Alan Milburn, and a £90 million investment into eight Youth Guarantee trailblazers currently running across England, testing local approaches to supporting young people.
Power of partnership: the importance of government and business working together
Employers are integral to the success of the Youth Guarantee. The DWP is working closely with employers such as, the Gym Group, which delivers the Accelerate PT programme, offering pathways for young people in the fitness industry and the English Football League in the Community which is delivering its flagship ‘Training Ground’ programme, which supports those who are NEET into jobs and further education. While partners such as the Premier League, are supporting with the expansion of Youth Hubs across Great Britain, which offer young people access to CV advice, skills training, careers guidance, and mental health support.
The Secretary of State and his ministerial team are looking to build on these excellent partnerships. Over the last few months ministers have met with major employers including Leyland Trucks, Babcock, and Vue to spur on employers across a broad range of sectors, sizes, and locations to support the Youth Guarantee and understand the key barriers to employment.
This all matters because the stakes are high. Skills shortages are already squeezing growth, with the latest British Chambers of Commerce (BCC) research showing 78 percent of firms are struggling to recruit. The rise of AI will accelerate change, demanding new capabilities across every sector.
Only by business and Government working closely together can we for truly start to fix the employment challenges facing our young people. Partnership working is crucial and that’s what we’re determined to do.
The BCC network and other business organisations are already supporting the Youth Guarantee and developing initiatives to help young people. The revamped Young Chamber scheme in West Cheshire and North Wales is one example of this kind of work in action. The network also has a proven track record of delivery and stands ready to help implement the Youth Guarantee. Through Local Skills Improvement Plans (LSIPs) from Cumbria to Cornwall, Chambers as designated Employer Representative Bodies have engaged tens of thousands of businesses in the skills system for the first time. DWP wants to build on this activity by working closely with the network to kickstart the Youth Guarantee and encourage local employers to work in partnership with the Department to create work experience opportunities, apprenticeships, Sector-Based Work Academy Programmes, support with the Jobs Guarantee and partner with the DWP to set up a Youth Hub.
Working together, the BCC and government can ensure the Youth Guarantee delivers for businesses and young people alike. Together, we can turn a moment of risk into a generation of opportunity. Futureproofing the workforce of tomorrow, today.
