Work and Pensions Secretary Pat McFadden is set to announce a £1 billion package on Monday, aiming to incentivise employers to hire young people and create 200,000 jobs.
This "new deal" seeks to reverse the growing number of "Neets" – young people not in education, employment or training.
The initiative includes a new Youth Jobs Grant, offering businesses £3,000 for each 18-24 year old hired who has been unemployed for six months or more, supporting an estimated 60,000 individuals.
A new apprenticeship incentive will provide small and medium-sized businesses (SMEs) with £2,000 for every new 16-24 year old employee. The existing jobs guarantee, offering a six-month role to Universal Credit claimants unemployed for 18 months, will expand to include those up to 24 years old.
Mr McFadden stated: "These measures will give life-changing opportunities to young people and significantly reverse the increase we inherited in those not in education, employment or training.
“We are focusing funding where it’s needed most and giving employers the flexibility and support they’ve asked for. These reforms will give young people a vital first step on the career ladder and help business leaders recruit the talent that will grow their companies."
Prime Minister Sir Keir Starmer affirmed his government's commitment, saying they were "determined to tackle the rise in youth unemployment by expanding practical routes into work, boosting apprenticeships, and giving employers the clarity they need."
He added: "These reforms underpin our ambition to create an economy that works for everyone, closing the skills gap and supporting more young people into meaningful employment."
The initiative has garnered support from prominent figures, including Michelin star chef Tom Kerridge.
He commented: "I’ve trained apprentices in my restaurants, and I know what a great start it gives them in their careers, and these incentives will give our industry a great boost. I’m pleased Pat McFadden has made this a priority."
The Conservative opposition, however, warned that job opportunities were "disappearing" under the Labour government, blaming the Employment Rights Act and increased national insurance contributions on employers.
Shadow Work and Pensions Secretary Helen Whately criticised the approach, stating: "The best way to tackle youth unemployment is to back businesses to create jobs, not tax them out of existence to fund benefits and subsidies.
“That’s why Conservatives will cut business rates for thousands of high street businesses and roll back Labour’s Employment Rights Act. That’s the way to create real opportunities for young people and get Britain working again."
Keir Starmer to pledge cost-of-living support amid Middle East crisis
Surge in young people jobless due to growing health crisis
Taoiseach declines to ‘get involved in ping pong’ between Starmer and Kneecap
Starmer and Trump discuss ‘importance’ of reopening Strait of Hormuz
Two people die after outbreak of ‘invasive’ meningitis at UK university
Two dead after meningitis and septicaemia outbreak at university
