The Chancellor of the Exchequer Rachel Reeves announced her commitment at the Labour party conference in Liverpool on 29 September, to further her pledge to invest monies in ensuring every young person that is not in Education, Employment or Training (NEET) will be offered a guaranteed work placement which is expected to be partially funded by employers with a subsidy being provided by the Government to Private sector employers to encourage them to participate in the plans.
Young people who have been on Universal Credits for 18 months or longer will be offered a guaranteed paid work placement, Rachel Reeves is set to announce.
Those who do not take up the offer could face losing their benefits. This comes amidst growing concerns on how to tackle youth unemployment and boosting the economy by getting people off of benefits, whilst helping young people develop new skills.
Earlier this year the Office for National Statistics (OFNS) reported an increase in the number of young people aged 16 to 24 years NEET in April to June 2025; the estimated total at the time was 948,000, up from 923,000 in January to March 2025, an increase of 24,000 on the quarter. This increase was largely caused by young women, with an increase of 25,000 on the quarter, while young men saw a decrease of 1,000. Of the total number of young people who were NEET, 497,000 were young men and 450,000 were young women.
People are considered to be in education or training if they:
- are enrolled on an education course and are still attending or waiting for term to start or restart
- are doing an apprenticeship
- are on a government-supported employment or training programme
- are working or studying towards a qualification
- have had job-related training or education in the last four weeks
The success of the scheme will depend on organisations signing up to the initiative, so the incentive of funding being provided will play a large part as many businesses face increased running costs, together with some apprehension around what will be announced in the upcoming November Budget.
It is expected that more details around the plans for this new scheme will also be announced in the budget, building on existing employment support and work placements delivered by the Department for Work and Pensions, crucial to this will be how the funding will be structured to cover the wages for any job placements.
