PARLIAMENTARY DEBATE
Youth Unemployment - 17 March 2026 (Commons/Commons Chamber)

I would like to make a statement on our new package of support to tackle the long-term problem of youth unemployment. Let me begin by wishing you, Madam Deputy Speaker, and the whole House a very happy St Patrick’s day. This year, due to Lenten abstinence, I will toast it with Guinness zero—one of the world’s great inventions.

The UK has historically high levels of employment overall. In its most recent report, the Office for Budget Responsibility said that employment would rise in every year of the forecast from 2026, and that unemployment would peak this year and fall in every year of the forecast after that. In fact, in only two of the last 150 peacetime years was the employment rate higher than it was in 2025. However, a particular and long-term issue faces the young, and it is time that young people were offered more hope and opportunity. That is what the package that we are bringing forward will do.

At almost 1 million, the number of young people not in education, employment or training is much too high. The Conservatives try to claim that that is all a result of decisions taken over the past two years—

It is!

In fact, we can hear them claiming it right now. But the truth is that the number of young people not in education, employment or training rose by 250,000 in the three years running up to the last election, and the Conservatives did precisely nothing about it. Youth unemployment has been rising since 2022, and youth employment never reached pre financial crash levels in any single year of the Conservatives’ 14 years in power. On top of that, the Conservatives kicked away the ladder of opportunity from young people when they presided over a shocking 40% fall in youth apprenticeship starts over the past decade.

The problem is long term and deep rooted. We will back young people with more youth apprenticeships, more chance of getting a job, and more help in overcoming the challenges they face. We have already announced a youth guarantee to help the young unemployed. It involves intensive work coaching, 300,000 work experience and training places, and subsidised work for long-term unemployed people aged 18 to 21. However, we will now go much further, with an explicitly pro young people package, aimed at helping them to learn and earn. From this summer, we will introduce hiring bonuses for businesses that hire a young person who has been out of work for six months. The bonus will be worth £3,000 per young person. There will also be bonuses of £2,000 for small and medium-sized businesses that hire young apprentices. Both bonuses can be combined if the young person hired has been out of work for six months or more. What a contrast with the Conservatives’ record on apprenticeships, which was to take opportunity away from young people—[Interruption.] They don’t like to hear it, but I am going to continue!

We are introducing new foundation apprenticeships in retail and hospitality, and new short courses in AI, electric vehicle charging point installation, electrical fitting and assembly, mechanical fitting and assembly, modular building, solar photovoltaic installation, and welding—the skills that young people need for the future. On top of that, the jobs guarantee, which we previously announced for the long-term unemployed, will be extended to those aged 22 to 24. Those young people will get six months of paid work, at 25 hours per week paid on minimum wage rates. Altogether, this will create 200,000 job and apprenticeship opportunities over the next three years.

This is our new deal for new times, offering new hope to the young people who are so often disparaged by the Conservatives as shirkers and scroungers. Our message is different: “We back you, we believe in you and we want you to succeed.” The package that I have announced is new investment of about £1 billion, and it comes on top of the funding that we announced at the Budget. Taken together, it is a package of support for young people worth about £2.5 billion. The existing exemption from employer national insurance contributions for workers under 21 will stay in place. This package is not just pro young people; it is pro business. I welcome the comments by the Federation of Small Businesses, which said that the provision is a “game-changer” and “a decisive step forward”, and rightly describes the package as “pro-jobs, pro-opportunities”. The package has also been welcomed by large employers such as Amazon, Kier Group and PwC, and the welcome goes beyond business. We know that a lot of young people face challenges in the labour market, and the chief executive of Mental Health UK, Brian Dow, said that the package

“will support young people to be ready for work and help organisations large and small to capitalise on the skills, talents and enthusiasm that young people have to offer.”

As well as the package, there is an urgent need to offer help to young people, given technological and demographic change. They need our help, and we cannot afford to lose their talent and energy. This is about not just young people, but their parents and grandparents. This is a generational challenge, because who does not want their child or grandchild to have a better chance in life? That is why investment in the young is a bond between the generations. It is an act of solidarity that is in the interests of the whole country, because if a young person has prolonged periods out of work, the scarring effects can stay with them for the rest of their life. A young person under the age of 25 on the health element of universal credit is now less likely to get a job than someone over 55 on the same benefit. We have to act to change that.

I am often asked, “So when will you do welfare reform?” Well, I tell the House that this is welfare reform. Putting work and opportunity at the heart of our system is the best reform we can make. Asking not just, “What are you entitled to?” but “How can we help you change your life?” is the change that the system needs. That view lies behind the changes that I am announcing in this package. I commend the statement to the House.

I call the shadow Secretary of State.

The Government have lost control of welfare. The benefits bill is ballooning. Sickness benefits alone will cost us £109 billion by the end of the decade. Working-age benefits are costing £161 billion right now and rising. But instead of bringing forward welfare savings, Labour MPs have chosen to spend ever more on benefits. Just the other day, they backed an extra £3 billion spending on scrapping the two-child benefit cap. It is all paid for in the same way—by taxpayers, by hard-working people, and by the businesses that employ them.

First the Government tax jobs, and then they wonder why there are fewer of them. Let me tell them: if you tax it, you get less of it. Under Labour, unemployment has gone up month after month. Our youth unemployment now rivals that of Greece, at over 16%. That is one in six young people out of work, wanting employment but denied the chance—and a university degree will not save them, either. Some 700,000 graduates are out of work, and nearly 1 million young people are not in education, employment or training. So many young people have done everything asked of them. They have studied hard, done their exams and got their grades, but now they are getting rejection after rejection to their job applications.

The Government are letting down a whole generation, and the Secretary of State knows it. He said so himself this week on the radio. He talked about the “scarring effects” of youth unemployment: worse mental health, worse outcomes and even lower life expectancy. He is right, so why are his Government making things so much worse? Let us be clear about what this new policy is. It is not a jobs plan or a serious new deal for young people; it is a sticking-plaster, and an expensive one costing over £1 billion. These are state-subsidised jobs to replace the real ones that Labour has killed.

The Secretary of State has laid into our record on apprenticeships, but he knows perfectly well that the drop he refers to happened because we raised the standard of apprenticeships to make them a qualification that would actually count, and to make them a meaningful alternative to university, not just a way for businesses to get cheaper workers. I warn him not to just chase higher numbers in his reforms; quality matters. And why are the Government doing nothing about dead-end degrees and mounting student debt? Why not adopt the policy we have announced of cutting back on low-value degrees, and using the saving to increase apprenticeships? This Government’s answer is to just go back, cap in hand, to the taxpayer.

At the end of his statement, the Secretary of State talked about welfare reform, but why do we never hear the important word “savings”? I think we know why. The Government tried and failed to make welfare savings last summer. What has changed since then? The Prime Minister is only weaker and more indecisive, though the problem becomes ever more urgent. Today’s personal independence payment figures show that claims are up again. There are over 300,000 more people on PIP since Labour took over—a rise of 9%—and the number of young people claiming PIP has risen by 14%. There are nearly 150,000 more people claiming benefits for mental ill health and neurodiversity. I have been clear: this cannot go on. Benefits are not the right answer. Work is better for us. People who can work should work.

The Secretary of State needs to answer some questions. Where exactly has the extra £1 billion that he has just announced for state-funded jobs come from? Will this latest plan actually bring down youth unemployment? Will it even touch the sides? How will he stop fraudulent claims for the cash? How will he make sure that no one loses their job because of his cash handouts? How will he make sure that all this spending makes a difference, and that he is not subsidising employment that would have happened anyway? Does he accept that taxing jobs on the one hand and subsidising them on the other is not an economic strategy, but the economics of the madhouse? Finally, can the Secretary of State at least agree that the benefits bill needs to come down? Perhaps he could take this chance to use the word “savings”. Does he see the irony? Does he understand my feeling of déjà vu? This is another plan from his party for welfare reform that spends more money, rather than saving it. When will he bring forward a plan to actually bring down the benefits bill? He talks about welfare reform; is this it?

I fear that the hon. Lady’s response was written without her listening to a word in the statement. She has confirmed that the Conservative party not only bequeathed us the problem, but has learned nothing about how to tackle it. There was no statement of responsibility, no statement of regret and no apology for the record on youth apprenticeships—in fact, she defended cutting youth apprenticeship starts. It is a continued pretence that somehow all of this started just two years ago.

The hon. Lady asks where the funding to help young people comes from. It comes from stable management of the economy—something that the Conservatives know nothing about and that we have practised for the past two years. Young people, at whom all of this is aimed, will have heard her disparage efforts to get them into work and to give them more opportunity. They will have heard her dismiss our changes, which will boost youth apprenticeships. They will have heard her pretend that we can somehow wish all this away with tax changes. That proves that the Conservatives have learned nothing from their disastrous management of the economy. They will have heard her say that the package does not offer young people anything, when we have announced a plan to give them a new deal with more jobs and more apprenticeships. That is the difference between our approach and theirs.

I want to give young people in this country opportunities to get skills, to get a job, to get off benefits and to build a better life for themselves. That is much better than kicking the ladder away and leaving the system unchanged, which is what the Conservatives did. How does the hon. Lady explain the number of NEETs rising by a quarter of a million in the last three years in which they were in power? How does she explain their lack of action to deal with it? When it comes to welfare, what I have said today is very clear and simple: the best means of welfare reform is to put work and opportunity at the heart of the system, and that is what we are doing with this plan.

Young people are often unfairly criticised, but it is worth remembering that the vast majority of them are in employment, education or training. Those who are not deserve our support, and to be provided with opportunity, not the condemnation and ignorance that was all they got from the Conservatives in government, and all we have heard from them today. Does the Secretary of State agree with me that the number of young people not in employment, education or training is a scandal, and that it demands action? Will he set out how this new investment will support young people in St Helens North and across the country?

My hon. Friend says that young people deserve support; I believe that with the right support, young people want to work and to make the most of their life. He asked how people in his constituency would be helped. They could be helped through the hiring incentives that I have announced, and through the hiring bonuses that will allow small and medium-sized businesses to hire a young apprentice. The young unemployed in his constituency will be helped, because we are offering hope, ensuring that they get a chance, and offering the sense of pride, purpose and dignity that comes with having a job.

I call the Liberal Democrat spokesperson.

The Secretary of State is correct to suggest that the Government inherited a crisis around youth unemployment. However, by introducing the hikes in national insurance contributions, the Government made that crisis into a catastrophe for young people, and supercharged the pressure on our youth across the United Kingdom. Rather than tackling what is now the root of the problem—the NIC hikes—these proposals are just papering over the cracks.

Young people’s childhoods are massively different from those that many of us experienced, especially hon. Members who grew up some years ago, so I pay tribute to the organisations that get young people to the right place, including Eat That Frog, Doorstep Arts, Sound Communities and South Devon college, who do incredible work. They help young people who have come through the pandemic, those who feel as though they are in a pressure cooker because of social media, which is gnawing away at their life, and who face a cost of living crisis.

The Liberal Democrats are concerned about an element of the Government’s policy: we do not understand why the Government are removing funding for apprenticeships for management. Surely managers are the people who support young people in their hour of need, as they go into work. Young people aspire to move into those positions eventually, so will the Secretary of State think again about the impact of the national insurance contributions hike on hospitality, retail and tourism industries in areas like Torbay?

I was interested to hear the Secretary of State speaking on the “Today” programme on Monday. The presenter challenged him by suggesting that the NIC hike had jacked up youth unemployment, and the Secretary of State appeared to agree with that. Finally, an article in The Times suggested that the Government are thinking about making young people second-class citizens through their changes to disability benefits; I would welcome comments from the Secretary of State about that.

The hon. Gentleman opposes the changes that we made to national insurance, but he neglects to mention that employer national insurance contributions are not required for employees under the age of 21, unless they are earning more than £50,000 a year. He opposes those changes while supporting extra expenditure on the NHS. As I have said to him a few times, if his party supports extra expenditure, it really has to support revenue-raising measures to fund it.

Young people will have heard the hon. Gentleman dismiss the changes that I have set out today; in fact, they will have heard him say that if he was asked to choose between management courses and young people, he would choose management courses—that is now the established position of the Liberal Democrats. I think that many people would be surprised to hear that in some years, most apprenticeship expenditure has gone on those over the age of 25 who are already in work. We have made a choice; we have chosen young people, and for good reasons. We have chosen them because of the scarring effects of youth unemployment, which I mentioned in my statement, and we now have on record that both the Conservative party and the Liberal Democrats are opposed to our prioritisation of young people.

I welcome this excellent initiative, with the backing of £2.5 billion of investment, and I commend the Secretary of State on trying to get a grip on the scourge of youth unemployment. We saw a generation lost during the previous Government because of the failure to support young people. What will the Secretary of State do to support disabled young people? The backlog and delays in the Access to Work programme are a real issue. Will he say more about what charities and social enterprises can do, and how they will be supported, in addition to the public sector, to get more young people who are NEET into work?

My hon. Friend asks about disabled young people. It is really important that we get more help and support to disabled people who, in the past, were too often signed off, written off and forgotten about. That is not good enough for them or for the country as a whole. The Connect to Work programme, which is devolved to elected mayors and local authorities, is helping disabled people, and the WorkWell programme seeks to get over the divide between health advice and employment advice. She is right that there are issues with the Access to Work programme. It is a really good programme, but there is a backlog that I want to see reduced because it is an important programme that helps disabled people to get into work and stay in work.

The national insurance tax rise and the upcoming implementation of the Employment Rights Act 2025 are just two of the reasons why businesses are on their knees. I welcome the Government’s youth guarantee, but how can the Government guarantee jobs when there will not be any businesses to offer those jobs?

I welcome the hon. Lady’s welcome of the youth guarantee. Perhaps she might have a word with her hon. Friend the shadow Minister, who did not welcome it. She asks about national insurance, but the problem is not new—what is new is the package of help for young people that I have announced today.

I refer the House to my entry in the Register of Members’ Financial Interests. As co-chair of the all-party parliamentary group for youth employment, I welcome the Secretary of State’s statement on these new measures. Members will know that Newcastle is home to the country’s best retail and hospitality offer, and I know many businesses will welcome the support for employing young people. Will the Secretary of State set out how his Department is working to ensure the balance between fairness in the administrative processes do not create any burden for small and medium-sized businesses to access the support?

I welcome my hon. Friend’s question and her praise for the great city of Newcastle, which I am sure we would all echo. On small and medium-sized businesses, she is right that we need to ensure that the systems are as easy to use as possible. There is a real direction of help in the package to small and medium-sized businesses, particularly with the hiring bonus for young apprentices. That is perhaps why the Federation of Small Businesses has described this programme as a “game changer” and a “decisive step forward.”

This is a socialist economic statement. If it moves, the Government tax it; if it keeps moving, they regulate it; and if it stops moving, they subsidise it. Will the Secretary of State accept that his national insurance rises, the changes to business rates and the “unemployment” rights Act have contributed to the hostile environment to employing young people?

I am not sure whether the hon. Gentleman’s description of this statement will do me good or harm among my right hon. and hon. Friends, but once again he makes the mistake of assuming that this problem is something that happened only in the last 18 months, which is where the Conservative party is going wrong. It is a long-term and deep-rooted problem. We need a different approach to tackle it, and that is why we need to offer hiring bonuses to businesses and to redirect the apprenticeship system to help young people, precisely because of the long-term scarring effects of young people being out of a job for any length of time. That can mean worse mental and physical health and, in some cases, even lower life expectancy than their peers in work. We have brought forward this package of measures today because of our concerns about that.

I am glad to hear that the employer NI exemption for staff under the age of 21 is staying in place. The new £3,000 hiring bonus for businesses taking on young people will make a real difference. How will the Secretary of State ensure that it is taken up by businesses and young people in Burnley, Padiham and Brierfield? Does he agree that the 40% drop in youth apprenticeships that we saw under the 14 years of the Tories left 1 million young people as NEETs and many without the opportunities and life expectations that they deserved?

We heard the Conservatives defend the 40% figure on the drop in youth apprenticeship starts—that is on the record. If they want to defend and own that record, so be it, but we want to prioritise opportunities for young people, and that is what we are doing with this package. There is a lot in it for employers in Burnley and for small and medium-sized businesses, which now have a new financial incentive to give a young person the vital start in life that can set them on a path of pride, purpose and dignity. That is what having a job gives you.

The Government want to cut funding for level 7 apprenticeships and redirect resources to younger groups, but bodies such as the Royal Institute of British Architects tell me that young people are unlikely to enter professional training in the construction sector, because funding will be withdrawn at the later, more expensive stages of their training pipeline. Does the Secretary of State accept that a one-size-fits-all, generalised cut-off point for 22-year-olds just does not work for industries that have a longer training period?

Once again, the Liberal Democrats speak against the prioritisation of youth. We are for training throughout the system and throughout the age range, but we have to make a decision about where to prioritise it with a public budget. I have unashamedly made the decision to prioritise young people, and I think that is the right thing to do.

Happy St Patrick’s day to the House and to all across the country.

The Secretary of State is absolutely to committed to this agenda, and that comes across in not just his words, but the action that has been announced today. May I highlight the vacancy period for apprenticeships? Only 16% of vacancies in England are advertised in the two months when young people are leaving school and going into the summer break. That means that many are waiting for months and months to even get the opportunity to apply for an apprenticeship, and that is contributing to the NEET figures that he cares about so passionately. Can we at least address that issue in the public sector so that most apprenticeships are advertised when young people are finishing their exams and leaving school?

Let me return the greeting of a happy St Patrick’s day to my hon. Friend.

My hon. Friend makes an absolutely vital point about information. When I talk to young people, they tell me that when they are at school, there is a lot of information about how to apply for a university course. That is great, and it is a great route for young people, but the information on how to apply for an apprenticeship is not as clear; it is not readily available to them or as much a part of the preparation process that many schools put young people through. There is a job of work to be done on information, because we want the clearest, most user-friendly information possible to be available to young people and their parents when making such a vital decision about their future.

I have a lot of respect for the right hon. Gentleman; I walk past his picture every morning. He was responsible for a major reform to the welfare system with the introduction of universal credit, but after that his party stopped reforming the system. We are seeing the costs of that, particularly with what has happened in the last few years.

On the Work programme, I am happy to look at any successful programme to help people into work. We have more than one of these programmes in the Department, and they should all be evaluated. The right hon. Gentleman makes an important point; we need to get support to people to overcome the barriers to get into work. With regard to national insurance, as I have said, all these things are costs for business, but this is not a new problem. This is a deep-rooted, long-term problem, and we need new answers to it. That is why I have brought forward this package today.

My generation has faced deep generational inequalities over the last decade. That did not happen by accident; it was the result of years of decision making in which the Conservatives chose austerity over investment into future generations. Nowhere is that clearer than in the fact that one in eight young people are not in education, employment or work—a generation lost. What steps is the Secretary of State taking to ensure that his Department and the Government are hearing directly from young people so that we can fully understand the barriers they face when entering work?

My hon. Friend is right. That ratio of 1:8 is too high, and it grew a lot in the last few years. She asks about discussions with young people, and she makes a really important point. When I talk to young people, they tell me that they want to work and make the most of themselves; they just need a platform that will help them. In every part of the programme that we have brought forward today, whether it is the apprenticeship changes, the help for the long-term unemployed, the short apprenticeship courses or the hiring bonus, the motivation that I have had is to give young people a platform on which to stand and take the next step in their lives.

People with special educational needs and disabilities are more likely not to be in employment or training. It is great that the new apprenticeship incentives will include recruitment for 19 to 24-year-olds with education, health and care plans, but a majority of people with SEND leave school without one. Will the Secretary of State set out what specialised support will be on offer to young people with SEND without EHCPs who are looking for work or apprenticeships, as well as what new guidance employers will get?

The hon. Member raises an important point. The issue of youth inactivity does not start at the age of 16; it often starts well before that. The reforms to the SEND system announced by my right hon. Friend the Secretary of State for Education very recently are really important in that regard, and we want the maximum opportunity for people. The last thing that we want is for people with special educational needs to be written off from the labour market; there has been too much of that in the past. Part of the package that I have outlined today is not about helping people into work then forgetting about them, but about supporting them once they are in a job so that we can get job retention and give young people the maximum chance of success.

The number of young people not in education, employment or training hitting 1 million follows a trajectory that has been ongoing for a long time and is a global phenomenon. I am delighted that the Secretary of State has today said that a Labour Government are determined to intervene and do something about it. How does he plan to measure the success of this scheme, and how does he think the Government and our education and work systems need to be more agile, given the onset of artificial intelligence technology?

I thank my hon. Friend for his question—I know that he takes a deep interest in this issue. There is an urgent need to help young people with the technological change that is taking place in the labour market. That is not just a British phenomenon; graduate unemployment in the United States went up from 5.3% to 5.7% in the final quarter of last year, and youth unemployment in the United States reached a four-year high last summer. We have to be less insular in our debate and understand that young people face particular challenges. That is why, for example, the different apprenticeship courses that I outlined in my statement are really important. They will train young people to cope with a different technological environment and ensure that we give them the maximum chance of success.

It frankly beggars belief that the Secretary of State does not understand the impact that the Government’s policies on business, tax and regulation have had on the confidence of businesses up and down the country to invest and employ. There is a direct causal link, and nobody will understand why the Secretary of State does not make that link and persuade the Treasury to do something about it. However, my direct question to him is this: why does he think that unemployment is always higher at the end of a Labour Government?

The OBR predicts that unemployment will peak this year and then fall in every year of the forecast—[Interruption.] Conservative Members disparage the forecast, but I gently remind them that disparaging the OBR did not work out too well for them a few years ago. In fact—to make a more serious point—the country is still paying the price for the fact that they did so, so I suggest that they learn that lesson.

I thank my right hon. Friend for the care and consideration he has shown in putting this package together. I am delighted today to be joined in the House by some inspiring apprentices from Caterpillar in my constituency, who have been talking about their experiences of moving into work. This matters in Peterborough, because we have one of the highest levels of youth unemployment for a generation, and it needs tackling. Can my right hon. Friend assure me that the work we are doing will not just benefit large employers such as Caterpillar, but put in place opportunities in the supply chain for small and medium-sized enterprises, so the brilliance of the apprenticeships we have at Caterpillar is extended to more and more young people in Peterborough?

I thank my hon. Friend for his deep interest in this issue. I have visited his constituency, and I give a warm welcome to the apprentices from Peterborough who are in the Chamber today. He asked about supply chains and small and medium-sized businesses. Those businesses will benefit from the hiring bonus for a young apprentice, which is why the Federation of Small Businesses has welcomed this package, describing it as a “game changer” and a “decisive step forward”.

For this scheme to work, we need vacancies for young people, yet we have a Government who are squeezing the very businesses that are needed to create opportunities and jobs for young people through business rates, energy costs and national insurance increases. The result, sadly, is that businesses up and down the country are going bust and unemployment is going up. I urge the Secretary of State, rather than apply an expensive sticking-plaster to this problem, to speak with the Chancellor and ask her to reverse the jobs tax.

I warmly welcome the Chancellor’s support for this package and the help that she has given me in putting it together. The right hon. Lady mentioned vacancies—there are about 700,000 vacancies in the economy, including 50,000 in manufacturing. I attended a jobs fair in Blackpool a couple of weeks ago, where almost 1,000 jobs were allocated on the day. There are vacancies in the economy, but we have to help young people to be in a position to be trained and have the confidence, skills and support they need to take them up.

Having seen the 40% fall in youth apprenticeships over the past decade and the long-term trend of increasing numbers of young people not in education, employment or training, I welcome the fact that this Labour Government are enabling more apprenticeships and opportunities for young people. Derby is a city of makers with a highly skilled workforce, but we need to train up the next generation, so can the Secretary of State tell us more about how this Government will work in partnership with businesses, including SMEs, to provide opportunities to young people, so that we can benefit from their talents?

Let me praise the magnificent industries in the Derby area, many of them manufacturing companies. As I said, there are 50,000 vacancies in manufacturing right now. What the trade bodies tell me is that they need help with skilling young people to take up those vacancies. That is precisely what will be made easier by the package that we have brought forward today.

I am not interested in discussing how we got to this point; we all need to work together to ensure that young people can get the opportunities they deserve and that those opportunities are available to them. I have read the Secretary of State’s statement from Monday, I have read the press release, and I have read and listened to today’s statement. There are some gaps about exactly how the timelines will work and what the legislative process for putting the package in place will be. Will he give us an assurance that the House will get this information at the earliest opportunity, so that we can work together to ensure that young people will have the opportunities that he is hoping they will get?

The rate of young people not in education, employment or training is, I believe, even higher in Scotland than it is in the UK as a whole. The hon. Member asks for more information on timescales. The hiring bonuses, for example, will be introduced from this summer, and the apprenticeship changes will be introduced from later this year.

I start by thanking my right hon. Friend for joining me at my jobs fair a few weeks ago, where more than 1,100 people secured work on the day. Some 900 are already in those jobs, working in our economy. That is Labour in action. I have spoken many times in this House about the need to support the hospitality and tourism industries, especially in coastal communities such as Blackpool, so that they can hire more young people and give them that opportunity. I got my first job at age 14, on Blackpool seafront. It was a great job that helped me get countless more jobs in hospitality. We need more young people to have access to those jobs. Does my right hon. Friend agree with me, Blackpool businesses and the Federation of Small Businesses that this plan is a game changer in tackling youth unemployment in Blackpool and other coastal communities across the country?

I thank my hon. Friend for the enormous amount of work that he put into organising the successful Blackpool jobs fair, which I attended a few weeks ago. He is right that the evidence from that jobs fair is that the vacancies are there, with more than 1,000 jobs allocated on the day of the jobs fair itself. Hospitality is a great entry route for young people. We have announced a foundation apprenticeship in hospitality as part of this process, and I hope that extends opportunity to other young people, similar to the opportunities that he had when he was a young man.

I refer the House to my entry in the Register of Members’ Financial Interests. I share the concern of many on the Opposition Benches about the national insurance increase, but I am particularly concerned by what is happening with graduate unemployment, which we have seen increase by 46% over the past six years. I draw the Secretary of State’s attention to the work of upReach, a charity that I have been involved in over the past few years. It is a social mobility charity that offers workshops, work experience and career coaching to young people. Will he engage with organisations such as upReach and Nick Bent, the excellent CEO who runs it, to see what lessons can be learned? In a world where AI is already taking many graduate jobs, it is concerning that the trend will only accelerate further.

As the right hon. Member knows, I have great respect for him. I am happy to reach out to upReach to speak about the work to which he refers. As I said a moment ago in response to another question, graduate unemployment is an international issue, not just one for the UK. There has also been an uplift in the United States, which we think of as possibly among the most dynamic economies in the world. Precisely because there is technological change, we need to help young people and support them through it. Policy has to catch up with the discussion taking place among young people themselves, because they are very alive to this issue, and they are evaluating their employment choices in terms of what they think will happen in the labour market and which jobs will be sustainable through this period of significant technological change.

Before being elected to this place, I spent many years working for charities seeking to tackle the challenge of youth unemployment. I remember fondly the future jobs fund, which, under the last Labour Government, delivered real change for people across the country. I have established the Get Hyndburn Working group to help tackle the challenge of economic inactivity in my constituency. It would be helpful if the Secretary of State could outline how what he has announced today will support that group in its endeavour to see young and, of course, older people secure good employment. Will he also—as he develops further strategies in this regard—pay particular attention to the importance of place and locally-led decision making, in order to tackle the specific challenges experienced in different parts of the country as we seek to get everyone into a good job?

I thank my hon. Friend for drawing attention to the record of the last Labour Government. I have described this as a new deal for new times, and it does adapt some of the lessons that we have learnt in the past to today’s very changed labour market. She mentioned the importance of locally-led work. It is true that local labour markets differ, and I want to work closely with local authorities and elected mayors on this agenda, because I think that they all want the best for the young people in their area. The Connect to Work budget, for example, is devolved for the next few years, with considerable flexibility for local leaders in relation to how they use the funding.

Measures to support about 17% of our young people in Wales who are not in education, employment or training to gain employment are welcome, although I prefer to use the term “LEET”—looking for education, employment or training—which I think is a much more positive way of viewing our young people. However, apprenticeships and skills are devolved in Wales, so will the Secretary of State tell me which aspects of his announcement apply to the young people of Wales and the other devolved nations?

I agree that “NEET” is not the best and most user-friendly term, but it has been used for some time. As for the hon. Lady’s question about what is devolved and what is UK-wide, the hiring bonus will apply throughout the UK, but the apprenticeship aspects are devolved to Wales.

One of my main priorities as an MP is to ensure that we see more of our young people in good, fulfilling work, because I know that far too many young people in Clwyd North are unable to fulfil their potential. I am excited about the £3,000 youth jobs grant and the expansion of the youth guarantee in Wales, but can the Secretary of State tell me more about the difference this will make to young people in Clwyd North?

I think that the statement offers hope to young people throughout the United Kingdom. I look forward to a positive and close working relationship between the UK and Welsh Governments on this issue, because I believe that both Governments share a desire for young people, in Clwyd North and everywhere else in the country, to have the best start in life. I think that, for example, the £3,000 hiring bonus and the jobs guarantee for the long-term youth unemployed, which are UK-wide initiatives, can help people in my hon. Friend’s constituency and offer hope that there is a solution to the scarring effect of leaving young people to fester in long-term unemployment, which is not good for them and not good for the country either.[Official Report, 25 March 2026; Vol. 783, c. 3WC.] (Correction)

I think we can all agree that tackling the rise in youth employment is very important, but I am concerned about the approach that is being adopted for that purpose. We are essentially taking money away from employers and then giving some of them some of it back. Has the Secretary of State considered, for instance, the use of existing levers in relation to employer national insurance? That would be an obvious way to address the issue and ensure that some of our young people are employed.

The hon. Lady refers to national insurance. As I have said, there is an existing tax break for employers of people under the age of 21 in the system, and they will continue to have that, but in addition they will have the hiring bonuses that I outlined in the statement. When we bring those things together, it sends a message that we want to help employers to employ young people and give them a good chance in life.

Under the previous Government, as the Secretary of State mentioned in his statement, youth employment never reached pre-financial crash levels in any single year, so the country had suffered a long period of stagnation. Crucially, some young people, unlike a bloke my age, have never known what an active Government can do to get them into good work. Will the Secretary of State confirm that this targeted package of support is precisely what the young people of this country need in 2026, and that it can finally turn the tables on years of Tory decline?

My hon. Friend is right. Let me repeat what he said, so that the whole House hears it: when the Conservative party was in power, there was not a single year in which youth employment reached the levels that there had been before the financial crash. Perhaps no other figure shows what a long-term problem this is. It is right that we have targeted support to enable young people not just to earn a wage, but to get the sense of pride and dignity that comes with having a job. I do not want to bombard the House with too many statistics, but another shocking one is that more than half the young people who are not in education, employment or training have never had a job in their life. They have never experienced the sense of discipline, obligation and pride that comes with getting up and going to work in the morning. That is what we have to change.

The Chancellor has spent the last 18 months pricing young people out of jobs, and now the Secretary of State has been asked to ride to the rescue by paying companies to get the same young people back into work. The Government are effectively robbing Peter to pay Paul. Why does he think that youth unemployment in my constituency is up by 15% since the general election?

Youth unemployment has been going up since 2022—it has been going up for around four years. What we have not had is a specific package to tackle it, but that changes with the package that I have announced today, which will offer real hope and opportunity to young people in the hon. Gentleman’s constituency. My gentle advice to him is to go and make the most of this package. That is what he should do for the young people in his constituency.

I welcome the support for small and medium-sized enterprises in my Shipley constituency, which will be able to take on young people who have been long-term unemployed and to offer apprenticeships, but the Secretary of State will know that young carers face additional challenges with getting into education, training or work. Shipley college provides excellent training opportunities, but often struggles to find work placements. Will he commit to working with DFE to ensure that all young people, including young carers, can benefit from today’s announcement?

My hon. Friend is right: there is a particular challenge for young carers. A significant proportion of the 1 million young people who are not in education, employment or training have caring responsibilities. I commend the work of Shipley college, and I am very happy to keep talking to her about this issue to see what help we can give to young carers.

Like the rest of the nation, my constituency of Leicester South struggles with youth unemployment, and many young people are not in education or training. The statement is welcome to a certain degree, but I have a technical question for the Secretary of State. Which age range will bonuses cover? Is it 18 to 21? Also, when will the bonuses be paid? Will it be on hiring, or after a certain period of work?

It will apply to young people between the ages of 18 and 24. The hiring bonus will be available from this summer, and we will look at having a retention mechanism so that people are not hired one day and let go the next.

Apprenticeship starts fell under the last Government, largely driven by the reduced uptake from SMEs, so today’s SME incentive is a game-changer. Can the Minister confirm that that incentive can be stacked with other incentives—for example, when hiring a care leaver—and will he send a message from the Dispatch Box to York employers that they should take on apprentices and provide the opportunity of a lifetime?

I think employers want to do the right thing—they want to give young people a chance. My hon. Friend asks whether the incentives can be stacked, and the answer is yes. For example, if a small or medium-sized enterprise wants to take on a young apprentice who has been unemployed and on universal credit for six months or more, it can claim both the £2,000 apprenticeship incentive and the £3,000 hiring bonus. That sends a strong signal to business, and it is why the Federation of Small Businesses has called this a game-changer, just as my hon. Friend did. It sends a strong signal about giving young people a chance, which is exactly what I think small and medium-sized businesses want to do.

I was lucky enough to get my first job when I was 16—washing up in a kitchen as well as working in a warehouse—which taught me some really good life skills about what it is like to be employed and the responsibilities that come with that. From speaking to businesses in my constituency, I know that those opportunities simply do not exist for young people at the moment. Being paid a bung to hire young people will not help, because the problem is the huge impact of business rates, national insurance contributions and the minimum wage on their ability to retain the staff they have. They are having to lay off those staff because they simply cannot afford to keep them on. Knowing full well that I will clip this and put it on social media, what will the Secretary of State say to businesses in my constituency to show them that he is listening to those concerns and will address them, rather than putting on a sticking plaster, as this package surely does?

The hon. Member mentioned his career in washing up, and let me tell him that we have that in common, because one of my first jobs was as a dishwasher in what I believe was Scotland’s first Mexican restaurant, Viva Mexico. I inherited that job from the current First Minister of Scotland, John Swinney, the previous dishwasher in that restaurant, so we can be the three founding members of a national union of dishwashers.

The hon. Member asked for my message to employers in his constituency. It is to look at this package and avail themselves of the support in it—hiring bonuses for young unemployed people, specific help for small and medium-sized enterprises when hiring a young apprentice, and foundation apprentices for retail and hospitality industries. All those things should be good for the small businesses, particularly those in the hospitality sector, in his constituency.

I really welcome this Government’s investment in our young people’s futures, but almost half of NEET young people are disconnected from the benefit system and traditional support. I know from my experience of leaving school at 16 just how much of a difference youth workers and trusted adults can make in giving those hidden young people a bridge into support. Can the Secretary of State say a little more about the role that he sees trusted adults playing in supporting young people into work, and reflect on the work of the pilots and the youth trailblazer areas in looking at the co-location of youth services and employment support?

My hon. Friend makes the very important point that a significant proportion of the 1 million young people not in education, employment or training are not claiming benefits at all, and not signing on for standard universal credit or the health element.

One way in which we want to reach those young people is through the expansion of our youth hub programme, which gives them a chance to come into a place—often a sports or community institution—and get a range of help on the health front, the housing front and the work-finding front, because young people do not live their lives according to Whitehall departmental boundaries, and why should they? It is up to us to tailor the help to the way they live their lives, and get it to them in the places where they want to be.

A couple of weeks ago, I hosted a student roundtable, with two pupils from my eight secondary schools and two from my further education college. I agree with the Secretary of State in that I was left incredibly excited for them and by their hopes and aspirations for the future. However, we also had a discussion about how AI-proof those plans were. His statement mentioned short AI courses, and he also talked about the urgency. Can he tell us how short these short courses will be, who is going to deliver them and how the young people of Spelthorne will sign up to them?

These short courses or apprenticeship units are something that employers have called for. Until now the minimum length of time for an apprenticeship has usually been eight or 12 months, or something like that, but these can be for a matter of weeks. We will publish more information about them as soon as we can. The sectors, including AI, in which the first wave have been announced are all sectors in which we will need the skills of young people. We are trying to adapt the training offer that we fund to the needs of employers, and one way to do that is with more short courses.

I warmly welcome the Secretary of State’s announcement. This is exactly the kind of initiative to tackle youth unemployment that employers in Glenrothes in my constituency asked me for just a couple of weeks ago. Can he assure me that he will work with Scottish agencies and the Scotland Office to ensure that the scheme has the maximum possible impact in Scotland, where youth unemployment is also far too high?

Yes, of course. I want to work with the Scotland Office, the Scottish Government and anyone who can make an impact. I visited the Bellshill jobcentre in central Scotland just before Christmas. I was told by the area manager that over 40% of the young people on her caseload were on what was called the “health journey”. That should bring us up short. It should tell us and warn us about the stickiness and the long-term effects of a young person being off long-term on sickness benefits. We have to do more to get opportunity to those young people and help them into work. I hope the package I have brought forward today can help us to do that.

Across the west midlands, around 29,000 young people are unemployed, with unemployment rates in parts of Birmingham, Wolverhampton and Walsall running at double the national average. I welcome the measures announced today, but how will the Government ensure they reach young people in high unemployment areas such as Birmingham Perry Barr, where approximately 2,000 young people are unemployed, rather than resources being spread thinly across the counties and the country?

Obviously, I know the west midlands well and I know the passion that our Mayor, Richard Parker, has for expanding opportunity, offering more skills and more opportunities to young people. I work closely with him on that agenda. I do not believe we should set area against area. Of course I am concerned about youth unemployment in the west midlands. I can assure the hon. Gentleman that his constituents and mine, and those in every other constituency in the west midlands, can benefit from the proposals I have brought forward today.

Glasgow has many brilliant young people who just want to work. They have been let down by the Tories and the SNP, with school standards plummeting and the refusal to fund the Rolls-Royce welding centre. In many meetings I have with employers, they emphasise to me how little they see of the apprenticeship levy they pay in. Will my right hon. Friend outline how the package provides opportunities to young people in Glasgow?

I do not need any convincing about how great a city Glasgow is, and I will be going there very soon. My hon. Friend asks what this announcement will mean to young people in his constituency and the city of Glasgow. The hiring bonuses I have announced today will be available all over the country, as will the subsidised job—25 hours a week at minimum wage rates for six months for young people who have been unemployed for 18 months or more—precisely to give young people not just a wage but the sense of pride and purpose that comes with having a job. I hope that that gives hope to the young people in Glasgow. It is hope that we need to give to young people all around the United Kingdom.

The managing director of G. W. Martin, a manufacturing firm based in my constituency, welcomes the hiring bonus included in the announcement, but he says that it will barely cover the cost of one month’s pay. More important to him are the candidates’ attributes and commitment, rather than any bonus on offer. I absolutely welcome any measure to support young people in my constituency into work, but will the Minister tell me what more is being done to ensure young people remain and succeed in the workplace?

I welcome the hon. Lady’s—somewhat limited—support for the announcement, but she is right that we need to support young people in the workplace. There is perhaps a touch of nostalgia about some of the comments about young people not being work-ready, because that was the traditional role of youth apprenticeships. When the ladder is kicked away from them, it is no wonder that more young people are not work-ready. We are changing that with this announcement, because we are re-emphasising the importance of youth apprenticeships. I hope she welcomes that part, too.

I thank the Secretary of State for this announcement, which will make a big difference to so many young people in our area of the Black Country who are looking for work or training but unable to find the opportunities they need. I recently visited Asda in Great Bridge, where I saw the supported internship scheme that is being run in partnership by Asda, Project SEARCH and Sandwell college. The scheme’s employment rate for learning-disabled young people is 60%, compared with 4% nationally. Would the Minister join me in congratulating Asda, Project SEARCH, Sandwell college, Rose, Manvir, Oliver, Trish and Romeo on the work that they are doing together to ensure that learning-disabled people can get into good jobs?

I thank my hon. Friend and parliamentary neighbour for her question. I know Asda in Great Bridge. What a wonderful employment rate that is, after the programme. It gives hope to young people with learning disabilities, who should never be written off; there has been too much of that in the past. Part of our work is to get more help and support to young people with disabilities, in order to give them the confidence and the opportunity that a job can bring.

I thank the Secretary of State for his statement. As someone who represents an area where more than 90% of businesses are SMEs, I particularly welcome the financial incentives for SMEs to take on young apprentices in the key industries of hospitality and retail. Demand for apprenticeships has been high for some time, so I welcome the Government’s recognition that supply-side incentives were needed to provide opportunities for young people in areas like mine. However, SMEs lack HR departments, and when I speak to business owners, they talk a lot about the complexity of engaging with the system. How will the Secretary of State make the system simpler for SMEs to engage with, so that we can give young people the opportunities that they desperately need?

My hon. Friend is right that we have tried to put extra incentives in this package for small and medium-sized businesses. In particular, there is the hiring bonus for young apprentices, which is aimed at both young people and small businesses. I hope that will be of help to the small businesses in her constituency. She is also right that clarity of information is important. Schemes like this can be complex, so I want to work with officials to make the information about this one, and the administration of it, as clear and simple as possible—consistent, of course, with the need to properly use and protect public money.

It was a pleasure to join my right hon. Friend at Bellshill jobcentre last year to hear about the need to support young people who are not in education, training or work. I greatly welcome this announcement, which will help transform life opportunities. Businesses in my constituency across a range of sectors highlight that despite their willingness to train the next generation of workers, intentions are often undermined by the failing apprenticeship system in Scotland. Can my right hon. Friend expand on how the positive actions of this Government will support young people in Scotland who have sadly and tragically been left behind by the SNP?

My hon. Friend and I had a great day in Bellshill just before Christmas; I am grateful to him for the visit, and to the staff at the local jobcentre for explaining to us both the work that they were doing. The programme I am announcing today offers hope to young people in his constituency; the £3,000 hiring bonus will be available throughout Scotland. Of course, apprenticeship funding is devolved, but I hope that the Scottish Government will provide the maximum opportunity for young people to combine an apprenticeship role with the hiring bonus, which is available to businesses across the country.

I must admit that I am a little disappointed by those on the shadow Front Bench, who are sneering and suggesting that plunging 3,000 Gloucester children back into poverty will somehow solve long-standing issues with youth unemployment. That is not backed up by the facts, and, quite frankly, it comes across as quite nasty. The Conservatives promised to level up places like Gloucester, but they left the most deprived parts of my city, and the young people living there, without the opportunity to get on.

I am really pleased to see Gloucester boy Tom Kerridge, who grew up in Matson in my constituency, backing the proposals that my right hon. Friend is putting forward. Can he explain to the House how more young people will be able to benefit from the Government’s reforms?

Tom Kerridge has achieved a great amount and done fantastic things. I was very pleased to meet him and talk to him about this package a few days ago, and I welcome his warm support for it. I agree with my hon. Friend on the response from those on the Opposition Front Bench. Young people throughout the country will have heard them dismiss the help that we are putting in place. If that is what the Opposition want to do, that is up to them, but we take a very different view. We want to give hope and opportunity to young people; we want to stop dismissing them; and we want to give them belief in their future. That is what this package is about.

The message from this Dispatch Box is clear: apprenticeships, apprenticeships, apprenticeships. This Government will meet the challenges that we face today with fantastic careers for the next generation, so thank you. SMEs in Darlington are huge engines of growth across the country. Many of the business owners came up through apprenticeship routes, and desperately want to pass on that opportunity to the next generation. We will bite the Secretary of State’s hand off for the £2,000 hiring bonus. Can the Secretary of State outline any sector-specific restrictions on the types of SMEs that can take advantage of the bonus?

We do not propose restricting the hiring bonus by sector, though my hon. Friend will have heard me list in my statement the areas covered by the new apprenticeship units—areas such as artificial intelligence, electric vehicle charging, infrastructure, solar panel installation, welding and so on. As regards the new short apprenticeship units, there are some specific areas that we are putting forward first.

I welcome this announcement. It will make young people’s lives and futures better. Calder Valley is famous for its world-class specialist manufacturing, but in the UK, one third of manufacturers are over 60. Can my right hon. Friend please confirm that this policy announcement will help us bring in the new generation of skills that we need for our economy?

This package can make a big contribution towards that. As I have said, there are 50,000 vacancies in manufacturing in the UK today. That is partly because of the difficulty that people have in finding skilled workers. With today’s extra help for apprenticeships for young people, we can begin to change that. That is why it is such an important part of this package.

I call Chris Bloore for the final question.

I am always happy to be last on an announcement such as this. The businesses and young people in my constituency strongly welcome what the Secretary of State has announced today. As I listened to those on the Opposition Front Bench, I was reminded of the statement by Senator Moynihan of New York:

“you are entitled to your own opinions, but you are not entitled to your own facts”.

Sadly, the Opposition have failed to mention that for over a decade, the UK has fallen behind other OECD countries when it comes to reducing the number of young people not in education, employment or training. That is because of structural failings in both education and public health, which the previous Government did nothing to solve. How can young people and businesses in my constituency of Redditch take part in this scheme, which will finally start addressing the tragedy of NEETs in our constituencies?

On the final question, I agree with my hon. Friend that this problem of young people not in education, employment or training is a long-term one that grew under the tutelage of the Conservative party, and about which it did precisely nothing. This statement and package is a different approach, with a very clear message behind it. Let us go out and sell it. That message is: we believe in Britain’s young people; we want to give them a better future; and we have a package of help to enable them to achieve that.