Britain faces a 25% increase in the number of young people not in employment, education, or training (Neet) to 1.25 million by the early 2030s unless the government takes urgent action to prevent a "lost generation," according to a landmark report led by former Labour health secretary Alan Milburn.
Milburn Review Highlights Systemic Failures
The highly anticipated report, due to be published on Thursday, warns that the UK risks opening up a "generational fault line" between young and old without significant reforms to schools, the health service, the welfare system, and the jobs market. Milburn will argue that the welfare state is "exacerbating inactivity" and that new work programmes alone will not address deeper-rooted problems.
"This is not a failure of young people. It is a failure of a system stuck in the past," Milburn will say. "Whether it is education or health or welfare, that system fails to enable their participation in the labour market. Instead, all too often it ends up putting young people on a path to a life not in jobs but on benefits."
Welfare Reform and Political Challenges
Any fresh attempt at welfare reform could prove divisive following Prime Minister Keir Starmer's chaotic benefits U-turn last year, amid concerns that cuts could drive up poverty during the cost of living crisis. The report comes as unemployment in Britain has risen to its highest level since the Covid pandemic, with young people particularly affected by the economic downturn and the fallout from the Iran war.
Starmer has argued that his government is tackling the cost of living crisis with financial help for struggling households and a long-term plan for jobs and growth. However, with the threat of a leadership challenge from Greater Manchester mayor Andy Burnham, Labour is locked in an internal row over how to use its time in power.
Call for Action on Youth Unemployment
Milburn will say that whoever leads the party into a general election against Nigel Farage's Reform UK should make cutting youth unemployment a top priority, with a central mission to repair Britain's broken social contract. He will warn that the promise that each generation should do better than the last is being broken, leaving parents and grandparents fearful about the future for today's young people.
Official figures due on Thursday are expected to show the number of Neet young people close to breaking through a million, the highest level for more than a decade. Milburn warns that without urgent action, the number could rise from one in eight to one in six young people within five years, representing 1.25 million lives.
Business Criticism and Government Response
The government has faced fierce criticism from business groups who say Labour policy has fuelled the crisis. Bosses have warned that entry-level jobs have been hit by chancellor Rachel Reeves' £25bn increase in employers' national insurance contributions, the equalisation of minimum wage rates, and the drive to strengthen employment rights.
Tina McKenzie, policy chair of the Federation of Small Businesses, said: "Ministers cannot ignore the impact soaring employment costs are having on hiring. They are a major factor when it comes to the number of Neets – which is a shame, because small firms want to back the next generation."
Decline in Entry-Level Jobs and Apprenticeships
The report will say young people are being failed by employers and the government amid a sharp decline in entry-level jobs and opportunities in hospitality, leisure, and retail. The "Saturday job" has long been dwindling, while job vacancies in hospitality have halved in the past four years, and apprenticeship starts among young people have fallen by 35% in the past decade.
Analysis shows Britain has the third-highest rate of 16 to 24-year-olds not earning or learning among rich European countries. The report finds six in 10 young people who are Neet have never worked, up from four in 10 twenty years ago.
"It's going in the wrong direction," Milburn told the Guardian. "When you look at that picture, I guess our conclusion is it's a catastrophic systems failure."
The review, commissioned by work and pensions secretary Pat McFadden, is expected to argue that overhauling health and disability benefits for young people is a necessary part of the solution. McFadden said he welcomed the report and that the government was taking action, but added: "I will work across government and with employers, charities and young people to drive real change, so more young people are earning or learning, not left behind."
