More than one million young people in the UK are currently not in employment, education or training, with a new report warning the country risks creating a “lost generation.”
The review, led by former minister Alan Milburn, estimates that young people outside work and education are costing the UK economy around £125 billion annually through lost productivity, reduced tax revenues and rising welfare and healthcare spending.
According to the report, Britain’s education, health and welfare systems are “no longer fit for purpose” when it comes to preparing young people for adult life and employment.
Milburn warned that by 2031, as many as one in six people aged 16 to 24 — around 1.25 million young people — could be out of work, education or training.
Youth Job Market “More Out of Reach”
Speaking to the BBC, Milburn said younger generations are struggling to access even entry-level opportunities.
“The first rung on the career ladder is now more out of reach for this generation,” he said, pointing to what he described as a growing “shortage of opportunity.”
Official figures released by the Office for National Statistics (ONS) showed that between January and March 2026, around 1,012,000 young people aged 16-24 were classified as NEET — the highest figure recorded in more than 12 years.
The data also revealed a sharp rise in economically inactive young people, with approximately 613,000 not actively seeking or available for work. Young women accounted for a larger share of this group than young men.
Meanwhile, around 400,000 young people were officially unemployed and actively looking for jobs.
“Hundreds of Applications, No Response”
Milburn rejected claims that young people are unwilling to work, arguing that many are making huge efforts to secure employment.
“This generation is trying,” he said. “Many are sending out dozens, sometimes hundreds, of applications every month and hearing nothing back.”
He added that many parents and grandparents fear younger people are being left behind economically and socially.
“The old social contract — work hard and you’ll do better than the previous generation — has been broken for many young people,” he said.
Pandemic, Mental Health and Social Isolation
The report concluded that there is no single cause behind the growing crisis. Instead, factors including the Covid-19 pandemic, smartphone use, changing labour market conditions and worsening mental health have combined to create what Milburn described as a “perfect storm.”
The review highlighted rising levels of anxiety and ADHD among young people, with many reporting mental health challenges as a major barrier to work and training opportunities.
Milburn also warned of the emergence of a “bedroom generation” — young people spending increasing amounts of time isolated at home and disconnected from society.
One participant interviewed for the report described how pandemic lockdowns affected social development.
“We didn’t really get used to face-to-face interaction again,” they said. “Simple things like eye contact and communication became harder because we spent so much time behind screens.”
Government Promises Youth Employment Reforms
In response to the findings, Work and Pensions Secretary Pat McFadden said the report exposed the scale of Britain’s youth unemployment challenge.
The government announced plans to create 500,000 opportunities for young people through new youth employment reforms, including expanded apprenticeships, subsidised jobs and a Youth Jobs Grant programme for businesses.
However, opposition politicians criticised the government’s approach, arguing that current policies have made it even harder for young people to enter the workforce.
