Health and disability

False starts

What the UK’s growing NEETs problem really looks like, and how to fix it

Julia Diniz
Julia Diniz
Louise Murphy
Louise Murphy

Nearly one million young people aged 16-24 in the UK are currently not in education, employment or training (NEET) – the highest level in over a decade. While the Government’s new Youth Guarantee marks a welcome step in the right direction, a more ambitious policy agenda that helps all young people to re-engage with education or enter sustainable employment is needed.

The NEET population is changing. Most NEETs are now economically inactive rather than unemployed, with rising numbers citing health problems or ‘other’ reasons for not working or studying. More than a quarter of all NEETs are inactive due to sickness or disability, and nearly half are not claiming benefits – meaning they are unlikely to be reached by Jobcentre-based programmes. NEET rates are highest among those with low qualifications, with six-in-ten never having had a paid job, underscoring the deep barriers many face in finding education or employment opportunities.

To reverse these trends, the Government must enforce participation requirements for 16-17-year-olds more effectively; and expand the Youth Guarantee to cover 22-24-year-olds as well as 18-21-year-olds and include those not receiving out-of-work benefits.

Key findings

  • The number of young people aged 16-24 who are not in education, employment or training (NEET) has risen by 195,000 over the past two years to reach 940,000, according to a new NEETs estimate using administrative data, in line with estimates from the Labour Force Survey.
  • Three-in-five NEETs are economically inactive – that is, not actively looking for work – rather than unemployed. And more than a quarter (28 per cent) cite disability or poor health as their reason for being out of work or study.
  • Despite concern about graduate employment prospects, it is lower-qualified young people who continue to have the highest NEET rates. NEET rates for graduates aged 22-24 have remained relatively low and stable at around 10 per cent throughout the past two decades. In contrast, NEET rates for 22-24-year-olds who hold a highest qualification that is at GCSE level or below have a NEET rate that is three-times as high (30 per cent).
  • While all young people aged 16-17 in England must participate in education or training following the Rising Participation Age (RPA) legislation introduced in 2013, their NEET rates haven’t budged, fluctuating between 4 and 5 per cent in both 2013 and 2025.
  • Out-of-work benefit claims among young people are on the rise: between 2019 and 2024, the number of 16-24-year-olds in the UK who are receiving Universal Credit (or equivalent) while out of work has risen from 430,000 to 530,000 – a rise of 24 per cent.
  • But nearly half (44 per cent) of NEETs do not engage with the benefits system. This raises the tricky question of how to design effective policy to engage with NEETs who have no reason to regularly engage with the state.

Recommendations

  • Strengthen enforcement of participation duties for 16-17-year-olds, ensuring local authorities track and re-engage young people who drop out of education or training.
  • Create a national ‘front door’ for 16-17-year-olds, to help young people access education, training or employment support quickly and consistently.
  • Expand the Youth Guarantee to cover all 18-24-year-olds, not just 18-21-year-olds, and ensure that those who are not claiming out-of-work benefits also qualify for support.
  • Rethink the proposed changes to health benefits for young people aged under 22 and instead undertake more ambitious changes to the benefits system that will actually reduce NEET numbers. This should include more frequent Work Capability Assessments for young people on UC-Health, and beefed up work search requirements for young jobseekers.
  • Do not abolish youth minimum wage rates. More generally, proceed carefully with measures that add to the costs of employing younger workers in the current labour-market environment.

Further reading

False starts
What the UK’s growing NEETs problem really looks like, and how to fix it
·
Julia Diniz, Louise Murphy
The good, the bad and the messy
Responding to the Pathways to Work Green Paper consultation
·
Louise Murphy
A dangerous road?
Examining the ‘Pathways to Work’ Green Paper
·
Mike Brewer, Alex Clegg, Louise Murphy

https://doi.org/10.63492/kvz546

Julia Diniz
Julia Diniz Postdoctoral Research Specialist
Louise Murphy
Louise Murphy Senior Economist