Subscribe to our newsletter to receive business tips, learn about new funding programmes, join upcoming events, take e-learning courses, and more.
Take the first step to successfully starting and growing your business.
Join for free)
Posted: Tue 28th Jul 2026
6 min read
More than a million 16 to 24-year-olds are now not in education, employment or training, the first time the figure has passed a million since 2013. The Prime Minister's answer, announced this week, starts at 14.
Under the plans, young people will combine core subjects such as English, maths and science with technical education linked to the jobs in their area from Year 10.
They will spend more time with employers, gain workplace experience and build the skills businesses ask for most, including teamwork, communication and problem solving.
Regional mayors, local leaders, schools, colleges and employers will shape these routes around local industries, from construction and digital to health and care.
Ofsted inspections will now recognise schools that help young people prepare for work, not just those that push everyone towards university.
Funding will shift towards high-quality technical education. The aim is to ensure "new technical pathways, careers advice, employer engagement and routes into apprenticeships are properly recognised alongside academic achievement."
Rollout begins from September 2028.
The model draws on Greater Manchester's MBacc, which, from age 14, steers young people through seven sector gateways towards the jobs growing in the city region.
Small firms are where a lot of young people get their first taste of work, and the plan leans on that.
Employers will be asked for mentoring, workplace visits, practical projects and work experience, coordinated locally by new Strategic Authorities – authorities with legal powers established under the English Devolution Act.
For a business of five or 10 people, that is a few days a year in exchange for early sight of local talent and a say in the skills young people leave school with.
Businesses that work in a sector highlighted as a key regional sector should expect an approach as the pathways take shape.
Our CEO, Aaron Asadi, joined the Prime Minister's first call with business leaders in his first week in office.
Youth unemployment drew more agreement than any other issue in the room when the Prime Minister called on employers to help restore the first rung on the ladder into work for young people in return for the government reducing the frictions that make doing business and hiring people more difficult.
We argued that jobs alone will not fix this while vacancies fall, and that entrepreneurship is the missing lever.
Structured start-up support for young people should sit inside the Youth Guarantee, so starting a business counts as a route into working life alongside a job or an apprenticeship.
Aaron said:
"The first rung on the ladder into work has disappeared for too many young people.
"Giving 14-year-olds real contact with employers and practical routes into skilled work is the right intervention at the right age – and small businesses, in every postcode, are where many will find that first opportunity… and where some will discover they can build their own.
"Enterprise Nation's community of 240,000 small businesses is ready to play its full part in this national effort."
Milburn's interim report put the annual cost of youth inactivity at £125 billion and warned the number could reach 1.25 million within five years without reform.
The new pathways are years off, though two routes are already open.
Work experience through Jobcentre Plus places young people with little or no work history in a business for two to eight weeks.
Participants keep their benefits, so there is no wage cost, and a placement can run four weeks longer if you offer an apprenticeship.
The Youth Jobs Grant pays £3,000 for hiring an eligible 18 to 24-year-old who has been on Universal Credit and out of work for six months. It opened on 30 June and is open to employers of any size, including sole traders taking on their first member of staff.
The job must be at least 25 hours a week and last at least 16 weeks, and businesses need at least six months of trading and an active PAYE scheme.
Payment comes in two parts, £1,800 at six weeks and £1,200 at 18 weeks. Those who employ three young people or fewer can have one funded hire at a time. Four to nine employees, two.
When Strategic Authorities start building pathways locally, we understand it’s important for local employers to take the first approach that comes. The businesses in the room early will shape what young people are taught.
We will keep pressing the case that the surest way to rebuild the first rung is to help young people build one of their own.
We give small businesses a voice – in the media and in Westminster. See our latest press releases, policy insights and how we're championing small firms. Visit the media and policy centre
