• More than one in three (36%) employers have reduced the number of entry-level jobs available to young people aged 16-24 in the last 12 months
• Almost half of medium-sized (48%) and large employers (46%) have cut entry-level roles – twice the rate of small employers (24%)
• Nearly three quarters (73%) say the level of young people not in education, employment or training (NEET) is a "national crisis", while 76% say employers have a responsibility to do more to support young people into work
• Just over two in five employers (43%) report having invested in AI or automation that has reduced the number of entry-level roles available, rising to 60% among large employers
• Researchers call on Government to hold firm on reforms to make work more secure while using the Jobs Guarantee to create additional, good-quality jobs and providing extra practical, local support to employers to enable hiring – particularly smaller firms.

The Government's efforts to tackle rising youth worklessness face a growing challenge as new employer evidence suggests entry-level opportunities for young people continue to decline.

New analysis of a Survation survey of 1,001 UK senior business leaders, commissioned by the Work Foundation at Lancaster University, finds more than one in three employers (36%) reduced entry-level jobs for young people over the past 12 months. Almost half of medium-sized (48%) and large employers (46%) reported cuts, compared with 24% of small employers.

Employers recognise the scale of the youth employment challenge. Nearly three quarters (73%) say young people face greater barriers to entering work than five years ago, while the same share describe the level of young people not in education, employment or training (NEET) as a "national crisis". More than three quarters (76%) recognise that employers have a responsibility to do more to support young people into work. The findings come as more than one million 16-24-year-olds are NEET, the highest number since 2013.

The analysis builds on Work Foundation research published in June, which found average weekly "starter" vacancies accessible to someone entering the workforce for the first time fell by 49% between 2016-17 and 2025-26. In late 2025, there was only one starter vacancy for every three NEET young people nationally.

Three in five employers (60%) agree that young people aged 16-24 are generally ready for the world of work, compared to 17% who disagree. Many employers are also taking action with 59% offering placements, apprenticeships, internships or work experience, and the same share providing feedback to unsuccessful young applicants. However, entry-level recruitment practices can also present significant hurdles. Nearly two thirds of firms prioritise education qualifications (63%) or prior work experience (62%). Just over two in five (44%) have used AI or automated systems to screen applications, and 43% say investment in AI or automation has reduced entry-level roles.

Ben Harrison, Director of the Work Foundation at Lancaster University, said: “Young people are entering one of the toughest labour markets in years, facing intense competition for a shrinking number of entry-level jobs and fewer opportunities to get a secure foothold in work.

“Our research suggests the challenge is not simply how to provide young people with more employment support. Opportunities for young people are declining, and for those living in weaker local labour markets, the options they face are constrained.

“But that doesn’t mean Government should step back from its drive to improve job security and pay – both of which will be key in reducing youth unemployment over the long term. The focus must remain on boosting the quality and quantity of roles available to young people. And that means doing more to directly create good jobs, while also providing additional support to employers to do likewise.

Larger employers reveal a capacity-opportunity gap

The analysis points to a capacity-opportunity gap by employer size. Large employers (250+ employees) are much more likely than small employers (fewer than 50 employees) to say they can support young people who have been NEET for six months or more (80% compared with 44%). Yet large employers are almost twice as likely to have reduced entry-level roles in the last year (46% compared with 24%) and 2.5 times more likely to say AI or automation has reduced such roles (60% compared with 24%).

Small employers are less likely to report closing entry routes, but also report less capacity to provide support. Just 40% say they can support young people with long-term physical health conditions or disabilities into work, compared with 78% of large employers.

Jobs Guarantee must add good jobs, not just replace lost jobs

The Government's youth employment drive includes an expanded Jobs Guarantee expected to support more than 90,000 young people over three years. From autumn 2026, eligible 18-24-year-olds who have been on Universal Credit and looking for work for 18 months will be offered six months of fully subsidised paid work for 25 hours a week, alongside wraparound support.

Harrison continues, “The Government is right to focus on boosting paid work through the Jobs Guarantee. But the test should be whether it creates additional, good-quality jobs in the places where the labour market is weakest. That means going beyond providing temporary work placements, and instead ensuring the state is working alongside employers to create more secure and sustainable entry-level jobs for young people where they are needed most.”

Building on the findings of their recent national study and this new employer survey, the Work Foundation is calling on the UK Government to make the Jobs Guarantee bolder by:

• Focus on good jobs: ensure roles offer a living wage, training, security and clear progression.
• Keep it voluntary: participation should remain a choice for young people.
• Prioritise additional, socially and locally useful work: subsidised jobs should add opportunity and benefits for local economies, rather than displace existing roles, and support local priorities and Industrial Strategy sectors.
• Fund trusted local intermediaries: youth charities, colleges and community organisations can be well placed to support young people furthest from work, but need stable, long-term funding.
• Provide practical wraparound support for employers: offer guidance on inclusive recruitment, job design, workplace adjustments, management and progression, particularly for smaller employers.

Commenting on the findings, Dr Divya Jyoti from Lancaster University Management School, who led recent research with young people, said: “These findings highlight a worrying double pressure on young people looking for work. Employers are reducing entry-level hiring at the same time as AI and automated systems are playing a growing role in deciding who gets through the recruitment process.

“In our research, young people described applying repeatedly for jobs and hearing little or nothing back. Some were left wondering whether their application had been seen by a person at all, or whether they had simply been filtered out by an automated system. Over time, that can damage confidence and make an already unforgiving jobs market feel impossible to navigate.

“AI indeed has the potential to support workplaces, but if investment in automation is reducing entry-level roles and making recruitment more impersonal, we risk making it even harder for young people to take their first step into work, which can have significant costs for society in the long term.”