The government is exploring the option of a subsidized jobs scheme to help young people get into work, Sky News understands.

The idea is being examined amid growing concerns about record levels of young people not in employment, education or training (NEET), according to sources familiar with the discussions.

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Data from the Office for National Statistics (ONS) shows that around 789,000 people aged 16 to 24 who are not studying full-time are neither working nor looking for work; this is the highest total in history.

There are also 422,000 unemployed people looking for work in this age group; This figure is almost double the figure two years ago, and the total number of unemployed youth has reached 1.2 million.

Experts told Sky News that the problem is mainly due to rising mental health problems and a lack of skills training and apprenticeships, which is coming at a huge cost to the economy.

According to an analysis by PricewaterhouseCoopers, GDP would increase by £23bn a year if the NEET rate across the country was reduced to match the regional best in the South West. Approximately 1 in 13 young people there do not receive education, employment or vocational training; In the northeast and Scotland, the rate is one in six.

Wage subsidy programs have been used in previous times of crisis to increase the number of young people entering the workplace.

Kickstart Plan launched by the Conservatives During the COVID epidemic Universal Credit paid for six-month work placements for young people aged 16 to 24 and relied heavily on the Future Jobs Fund, which the previous Labor government launched after the financial crisis in 2008.

‘The subsidy program should be targeted’

Experts welcomed the idea but said the policy would be expensive and should be targeted if reintroduced as disadvantaged groups would benefit most.

A recent impact evaluation of Kickstart found that the scheme was the most effective at helping people without GCSEs, as well as those with special educational needs and those eligible for free school meals, remain in the workforce after the scheme ends.

“The results show that Kickstart tends to have a higher impact for more disadvantaged groups (who would have worse outcomes in the absence of Kickstart),” the paper said.

“This finding may have implications for future targeting of policies such as Kickstart.”

It appears that the job subsidy is just an idea being discussed to get more young people into work, with no final decision being made.

A Department for Work and Pensions spokesman said: “We do not comment on speculation.”

‘Investing in needed skills’

A Labor MP told Sky News such a plan would need to be accompanied by greater investment in skills and apprenticeships; This lack of investment causes problems in blue-collar areas like theirs.

“The biggest challenge is the low-skill economy,” the MP said.

“I hate when people say young people are lazy. The system isn’t working for them. We need to expand investment in education and reform the apprenticeship levy.”

Read more:
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Stephen Evans, chief executive of the Institute for Learning and Work, echoed these sentiments, saying a subsidized jobs scheme was a good “fallback solution” but there were “lots of things that could be done before that”.

He calls on metropolitan mayors to join in delivering the “Youth Guarantee” promised in Labour’s manifesto.

This promises support for all young people aged 18-21 to find training, apprenticeships or employment, but it is not yet clear how this will work in practice.

“We want mayors to go find these people,” Mr. Evans said. “Consolidating services locally is really important to reduce NEET figures.”

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The rise of youth unemployment reflects a trend of increasing economic inactivity among the wider population since the pandemic.

A government source said a white paper promising to “make Britain work” will be published in the next few weeks and will include “major reforms” to achieve an 80 per cent employment rate.