A Million Missing: An Employability Dilemma

Finito World

There is a particular kind of statistic that lands with a dull thud rather than a bang. The latest one is 957,000.

That is how many 16–24 year-olds in the UK were not in education, employment or training at the end of 2025. Nearly a million young people. 12.8% of that age group. A figure “stubbornly close” to the post-financial-crisis peak.

This is not a marginal cohort. It is a warning light.

When almost one in eight young people is outside both learning and earning, we are not dealing with individual failure. We are looking at a structural employability problem — one that stretches across skills, health, incentives, employer behaviour and policy design.

And this becoming harder and harder to reverse.

First, context. The employment market is weak. Hospitality has retrenched. Graduate schemes have been cut or quietly narrowed. Entry-level roles — the rungs that traditionally allow a young person to climb — are fewer and more contested. The ONS data shows a rise in unemployed young people actively seeking work, while economic inactivity among young women has driven much of the recent increase. Long-term sickness, mental ill-health and neurodivergence are increasingly cited as contributing factors.

The detail matters because this is not simply a recession story. It is not even primarily a cyclical story.

The 2008 crash pushed youth unemployment over a million: awful as this was, it was part of a comprehensible macroeconomic shock. Today’s near-million sits in a far more complex terrain. The economy is not collapsing. Yet a generation is stalling.

For many young people, confidence is eroding. Commuting feels unfamiliar. The workplace becomes not just a physical environment but a social maze. Autism, he says, can be a strength — but many employers do not know how to harness it.

This is the employability dilemma of 2026. Talent exists. Employers struggle to access it. Young people struggle to translate it. The bridge between the two is fragile.

The policy response so far oscillates between support and sanction. The government promises apprenticeships, guaranteed paid placements after 18 months out of work or education, and stronger incentives for businesses to hire. At the same time, there is the threat that refusal of placements could result in benefits being withdrawn.

Here we should pause. Employability cannot be coerced into existence.

Sanctions may move statistics in the short term. They do not build confidence, skills or trust. Nor do they address the deeper issues: weak early careers pipelines, employer risk-aversion, mental health fragility, regional inequality, and the paradox of minimum wage reform.

The proposal to scrap the lower minimum wage for 16- and 17-year-olds might be well-intentioned — fairness, parity, dignity. But employers are already warning that raising the cost of inexperienced labour reduces the incentive to hire inexperienced labour. If entry-level hiring becomes more expensive in a tight-margin environment, firms do what firms always do: automate, delay, or demand prior experience.

The ladder shrinks from the bottom up.

This is the part of the debate we often avoid. Youth employability is not only about young people; it is about employer psychology. Firms hire when risk is manageable. A 22-year-old without experience represents uncertainty: productivity unknown, retention unknown, training costs upfront. In boom times, companies absorb that risk. In cautious markets, they retreat to “safe hires” — lateral moves, experienced staff, internal promotions.

Young people become collateral damage of caution.

There is also a cultural dimension. Over the past decade we have rightly emphasised university
participation. But as graduate schemes contract and white-collar AI threatens entry-level administrative roles, the traditional graduate pathway is narrowing. At the same time, vocational prestige still lags aspiration in many families. We tell young people to “follow their passion” — then wonder why they are stranded when passion does not meet demand.

Add to this the quiet mental health crisis. The Youth Futures Foundation notes rising long-term sickness and neurodivergence as drivers of inactivity. Confidence, resilience, executive function — these are not abstract virtues. They are employability infrastructure. When that infrastructure weakens, job centres cannot simply re-route the traffic.

So what would seriousness look like?

First, early intervention — not after 18 months, but at the first sign of drift. The longer someone is out of structured work or study, the more employability decays. Habits calcify. Networks thin. Identity shifts from “I am becoming” to “I am stuck.”

Second, employer co-investment. If we expect firms to hire at-risk youth, we must reduce the perceived risk. That may mean wage subsidies, insurance mechanisms, structured probation support, or shared training models where costs and mentoring are not borne solely by the first employer willing to try.

Third, skills realism. The growth sectors — AI infrastructure, green energy, construction, care, digital services — require specific competencies. We cannot solve youth unemployment with generic CV workshops. We need direct pipelines into real demand, region by region.

Fourth, cultural honesty. Not every 18-year-old needs university. Not every young person is “entrepreneurial” in the Silicon Valley sense. But almost every young person needs a sense of trajectory. The absence of trajectory is what corrodes employability most quickly.

The Resolution Foundation calls the current moment “perilously close” to an entrenched crisis. That word — entrenched — is the one that should worry us. Youth worklessness becomes intergenerational. Communities adapt to absence. Employers stop expecting local talent. The social contract thins.

And yet this is not irreversible.

We are not dealing with a lost generation, but with a generation facing complex barriers at the precise moment the labour market is recalibrating. The danger is not that young people lack potential. It is that the system struggles to translate potential into participation.

Nearly a million young people sit outside both education and employment. That is not just a statistic; it is dormant capacity.

The question is whether we treat it as a welfare problem to be managed, a political embarrassment to be trimmed, or an employability challenge demanding structural repair.

If we choose the last, we might yet prevent today’s 957,000 from becoming tomorrow’s million.