Today’s ONS data indicates the ongoing challenges impacting the labour market are making it harder for young people to enter, progress, and make a decent living in the world of work.

Youth unemployment remains a challenge

While unemployment has fallen slightly since last month to 4.9%, 124,000 more people are out of work relative to last year. More than two thirds of the increase in unemployment have been driven by young people aged 18–24, while youth unemployment, which stands at 14.5%, is well above the levels seen for much of this century outside of the years preceding the Global Financial Crisis.

Figure 1. Unemployment rate for 18-24 year olds (%), 2000-2026

Source: ONS dataset A01 - unemployment 2000-2026

Fewer footholds in the labour market

At the same time, opportunities to gain a foothold in the labour market have declined. The number of job vacancies has decreased to 707,000 – its lowest level for five years.

This decline is of particular concern to young job seekers. Recent Work Foundation analysis of Adzuna online job vacancies data found that the number of ‘starter’ jobs available to first-time entrants has fallen by 49% over the last decade. While data from HMRC shows that the number of new recruits was at a five-year low, with the number of 'inflows', or new hires, just under 540,000 in April - the lowest monthly figure since March 2021.

The challenging of building a prosperous career

Today’s figures also reveal that private sector wage growth has slowed to 2.9% its lowest level since the height of the pandemic in September 2020.

While this decline affects workers of all ages, it poses the greatest challenge for young people. Housing costs have risen far faster than average earnings, while inflation has hit younger people particularly hard. With wages stagnating and concerns about retirement affordability growing, it is becoming increasingly difficult for young people to build financial security or save for major life milestones such as buying a home or starting a family.

The risk of a lost generation

This data underlines that whoever is Prime Minister in the months ahead, Government need to prioritise actions which boost opportunities for young people to get on in the labour market. We need to see a bolder, more localised approach to the Jobs Guarantee focussed on providing access to good quality, secure employment opportunities. Otherwise, the Government risks presiding over a lost generation, locked out of decent, sustainable work and unable to afford the day-to-day necessities, let alone key life milestones, or life after work.

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