UK policymakers must do more to prevent the rapid rise of NEET young people increasing, argues Katie Porteous, IF student intern.
Record high NEET numbers
Latest Office for National Statistics (ONS) figures reveal that a staggering 987,000 young people aged 16–24 in the UK are now classified as NEET (Not in Education, Employment, or Training). This represents 13.4% of that age group, an extreme rise compared to three years ago when NEET rates were their lowest at 9.5%. This alarming statistic paints a picture of a generation facing unprecedented economic challenges. Without action, young people face being locked out of the labour market and the scarring effect this will have will be profound.
A crisis defined by mental health struggles
Of the young people classified as NEET, 595,000 are economically inactive, up by 26,000 on the previous year. This inactivity appears to be inextricably linked to a burgeoning mental health crisis. A recent survey found that 31% of NEET young people cite poor mental health as a major challenge both for entering and progressing within the workplace. This is compounded by the fact that 50% reported feeling hopeless about the future due to unemployment, highlighting a cyclical relationship where limited job prospects and mental health challenges mutually reinforce negative outcomes for young people.
The severity of this situation is underscored by the doubling of young people out of work due to ill health in the past decade, reaching approximately 190,000 last year, a substantial portion of which is attributed to mental health issues. This surge emphasises insufficient support for young people’s mental well-being, a failure amplified by a support system struggling to cope with the aftermath of the COVID-19 pandemic. Younger generations disproportionately impacted by the pandemic’s disruptions now face the consequences of this neglect. While mental health services are essential, it is equally vital that workplaces are equipped to provide the necessary resources and foster a safe, healthy environment for young employees.
Economic scarring
The rising NEET numbers increases the likelihood that younger workers will experience what economists call ‘scarring’. Research has shown that periods of unemployment at the beginning of a person’s career can have life-long negative impacts on their employment prospects, earnings, and economic stability. A UK study found that those who were unemployed during youth suffered a wage penalty of 13-21% in their forties. Beyond its economic consequences, prolonged youth unemployment also has psychological and social costs. It has been linked to higher levels of stress, depression, and reduced confidence, all of which can contribute to a cycle of job market detachment and precarious employment. Without adequate intervention, young people who struggle to find stable employment are more likely to be trapped in low-paid, insecure jobs with limited opportunities for advancement.
Regional disparities and systemic failures
There are significant regional disparities in NEET rates across the UK. In October to December 2022, the Northeast had the highest NEET rate at 17.2%, while the South West had the lowest at 7.8%. These disparities are symptomatic of structural inequalities that render young people exceptionally vulnerable.
The lasting impacts of deindustrialisation in regions such as the Northeast has restricted the availability of high-quality employment opportunities for young people. This pre-existing vulnerability has been further exacerbated by successive economic shocks, notably the 2008 recession and the COVID-19 pandemic, both of which have inflicted profound and lasting economic scarring for younger generations. Consequently, today’s young people are not only grappling with the lingering effects of these crises but also facing the escalating pressures of the cost-of-living crisis, the housing crisis, and the accelerating impacts of climate change. This intersection of systemic failures and economic realities shows a clear intergenerational injustice, where the burdens of past and present economic instability are disproportionately placed on the younger generation.
Current policy offers little solace. There has been a concerning decline in financial support for young people. For example, the Education Maintenance Allowance (EMA), which helped young people cover costs such as transport to and from school or college, was allocated £580 million to help young people in 2011. This has since plummeted to a mere £150 million today, leaving countless young people without crucial support especially when children now have to remain in education or training until the age of 18.
Apprenticeships: A missed opportunity
Apprenticeships can be a valuable pathway for NEET individuals, offering practical skills and real-world experience. For those at risk of disengaging, spending time in the workplace can be beneficial in incentivising and inspiring. Despite a dramatic expansion in apprenticeships in recent years, the number of 16–18-year-old participants remains stagnant, demonstrating a failure to effectively connect young people with these opportunities. As Dr. Andrea Barry, principal economist of Youth Futures Foundation notes, “not enough are able to access them.”
Previous schemes that gave pupils a chance to gain work experience and qualifications have proved immensely successful. For example, the ‘Young Apprenticeships’ programme, which began in 2004, allowed pupils aged 14 to 16 to spend two-days-a-week in the workplace. As a result, 95% of participants progressed onto further education or training, with 19% moving on to an apprenticeship.
Not enough emphasis is placed on apprenticeships, with the focus on traditional academic subjects overshadowing vocational and technical alternatives which have been more effective in engaging young people at risk of disengagement. Low-quality careers guidance and lack of apprenticeship promotion within schools blocks a greater take-up and interest in apprenticeships.
Urgent need for action
This crisis calls for urgent and comprehensive action. Sufficient investment in mental heath services to support young people struggling with mental health challenges is vital. Regional disparities highlight the need for fund initiatives such as the EMA to provide adequate financial support to those from low-income households, particularly in their transition to the workforce. Additionally, expanding access to quality apprenticeships and vocational training will ensure that young people have viable opportunities to employment.
There is the potential to add £69 billion to the economy if the UK was to match the lowest NEET rate in the Organisation for Economic Co-operation and Development (OECD). This will not only improve the UK’s economic state but help hundreds of thousands of young people find the pathway in life that is right for them.
The NEET figures serve as a warning. Without immediate and substantial intervention, we risk condemning a generation to economic hardship and social exclusion. The future of our young people depends on our ability to act now. On intergenerational fairness grounds alone, we owe to our youngest workers to equitably invest in their future prospects.
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