Chancellor should make a NEET exception to her ‘policy-free’ Spring Forecast and expand support to tackle youth unemployment

The number of young people not in education, employment, or training (NEET) increased slightly at the end of last year to reach 957,000.

With the UK perilously close to having over one million NEETs for the first time in 13 years, the Chancellor should use the Spring Forecast next Tuesday to take action and prevent youth unemployment rising further, the Resolution Foundation said in response to new ONS data published today (Thursday).

The recent uptick in young people (aged 16-24) who are NEET has been driven by a weakening jobs market which has left almost one-in-six (16.1 per cent) young people who want to work unable to find a job. Even before today’s release, unemployment has been a persistent reason for being NEET, accounting for two-in-five NEET young people.

The Government needs to act fast to tackle this growing problem. While the Chancellor has promised a ‘policy-free’ fiscal event next Tuesday, the Foundation says she should make a NEET exception because too many young people risk being left behind.

Instead, the Chancellor should expand the recently-announced Jobs Guarantee. Currently, the scheme is open to 18-21-year-olds who have been unemployed for a minimum of 18 months. Eligibility should be broadened to include 22–24-year-olds, and the qualifying period should be reduced to six months. With an initial trial phase scheduled for this spring, the Government must ensure it is accessible to the widest number of young NEETs.

In light of today’s data, the Government should also pause the convergence of the youth minimum wage with the National Living Wage until youth unemployment begins to fall, says the Foundation.

Finally, despite concerns about graduate employment, the Foundation says that it is young people with lower qualifications who are most likely to not be working or studying. Almost half (44 per cent) of NEETs aged 22-24 only hold a qualification at GCSE level or below, compared to just one fifth (20 per cent) of all young people of the same age.

Louise Murphy, Senior Economist at the Resolution Foundation, said:

“Britain is perilously close to having a million young people not in education, employment or training for the first time in 13 years.

“The Chancellor has an opportunity to take fast and decisive action to address this problem at the Spring Forecast next Tuesday. She should make a NEET exception to the ‘policy-free’ fiscal event by expanding eligibility to the Jobs Guarantee for young people, and making sure support arrives soon. The Government should also pause further alignment of youth minimum wage rates until youth unemployment is falling.

“Today’s data adds to the picture of a generation up against real and complex barriers to finding a good job and improving their living standards. But acting sooner rather than later can help prevent these worrying trends becoming an entrenched crisis.”