Nearly one million young people in the UK are now outside work, education or training, underlining growing pressure in the youth labour market as economic and

policy headwinds collide.

Official figures released on Thursday show that 957,000 people aged 16 to 24 were classified as not in employment, education or training (NEET) in the final quarter of 2025. That marks an increase from 946,000 in the previous quarter and brings the total close to the highest level seen since 2014.

Economists often see the NEET rate as a clearer signal of structural problems than the headline youth unemployment figure. While unemployment measures only those actively seeking work, NEET data captures young people who may have dropped out of both education and the labour market altogether.

The latest figures place the NEET rate at 12.8%, up slightly from 12.7% in the previous quarter. Although this is below the decade-high of 13.2% recorded a year earlier, it remains alarmingly high. By comparison, the unemployment rate across the wider working-age population stands at 16.1%.

Concerns about policy-driven barriers to youth employment have also intensified. Earlier this week, Bank of England Chief Economist Huw Pill told a parliamentary committee that higher minimum wages and rising employer social security costs have made it harder for young people to secure entry-level jobs.

That assessment is shared by a majority of academic economists. In a recent poll conducted by Britain’s National Institute of Economic and Social Research and the London School of Economics Centre for Macroeconomics, 15 out of 19 respondents said government policy played a “very” or “moderately important” role in driving youth unemployment.

Ricardo Reis, a professor of economics at the LSE, said recent policy changes were “the most likely proximate cause” of the sharp swings in youth joblessness, though he cautioned that the evidence was not definitive. Other economists pointed to weaker economic growth and the rapid spread of artificial intelligence as additional pressures on entry-level roles.

Policy responses are now under scrutiny. Louise Murphy, a senior economist at the Resolution Foundation, said Chancellor Rachel Reeves should use next week’s fiscal statement to expand access to work placements and reconsider plans to narrow the minimum wage gap between younger workers and adults.

With youth disengagement nearing levels not seen in more than a decade, economists warn that failure to act could leave lasting scars on a generation’s earning power and long-term prospects. Photo by Alexis Brown alexisrbrown, Wikimedia commons.