The British Chambers of Commerce (BCC) has issued a stark warning that the UK is at risk of creating a ‘lost generation’ of young workers unless immediate action is taken to address the growing jobs crisis among young people. With nearly a million individuals from Generation Z currently disengaged from work, education, or training, the BCC is calling for urgent government intervention to remove barriers and create opportunities for this demographic.
Key takeaways
- The BCC reports a significant rise in the number of young people not in employment, education, or training (NEET).
- Recommendations include increased support for SMEs to hire and train young workers.
- The economic impact of addressing the NEET issue could add £69 billion to the UK economy.
- Mental health issues are a significant barrier for many NEET individuals.
The current landscape
According to the latest data from the Office for National Statistics, the number of NEETs has surged by over 110,000 from late 2023 to early 2024, reaching a total of 987,000. This alarming figure includes 392,000 unemployed individuals and 595,000 who are economically inactive. The BCC’s report highlights that the economic benefits of tackling this issue could be substantial, potentially adding £69 billion to the UK’s output.
Recommendations for action
The BCC has outlined several key recommendations aimed at reversing the trend of youth disengagement:
- Invest in support: The government should provide resources to help young people transition into the workforce.
- Support SMEs: Small and medium-sized enterprises should receive assistance to hire and train young workers effectively.
- Enhance workplace health support: Firms need to address health issues early to retain staff and maintain productivity.
- Set targets: The government should aim to reduce the NEET rate to levels comparable to those in the Netherlands.
The role of mental health
Research conducted by the Kings Trust reveals that mental health challenges are a significant barrier for many young people classified as NEET. One in four individuals in this category expressed a desire to work but felt unable to do so due to mental health issues. Furthermore, over half reported that prolonged unemployment has diminished their confidence in their skills, making it increasingly difficult to re-enter the job market.
A collaborative approach needed
Shevaun Haviland, Director General of the BCC, emphasised the urgency of the situation, stating that the UK’s workforce is ageing while the number of young people not engaged in work or education is at its highest in a decade. She noted that Generation Z faces a dual challenge of increasing barriers to employment and a shrinking number of job vacancies.
Haviland called for a more collaborative approach from the government, highlighting existing initiatives like the Youth Guarantee and post-16 strategies. However, she stressed that these efforts must be coordinated across various departments to be effective.
Conclusion
The BCC’s report serves as a wake-up call for both the government and businesses. Without immediate and comprehensive action, the UK risks losing an entire generation of young talent, which could have long-lasting implications for the economy and society as a whole. Employers are encouraged to step up and create pathways for young people, while the government must provide the necessary support to facilitate this transition. The time to act is now, before a generation is left behind.
Sources
- Business Seek Action On Lost Generation, Edinburgh Chamber of Commerce.
- Subscribe to read, Financial Times.
