Press release

Boost for unemployed young people as Youth Contract opens for business

Britain’s unemployed young people are being given a major boost today as the Youth Contract opens for business.

This was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

Britain’s unemployed young people are being given a major boost today as the Youth Contract opens for business. Nearly half a million young people are set to benefit as £1 billion becomes available to get them into new jobs or training.

The Youth Contract, launched by the Deputy Prime Minister Nick Clegg and Minister for Employment Chris Grayling, supports businesses to get young people earning or learning. The Government is determined to tackle youth unemployment and those out of work aged between 16-24 are urged to go to their Job Centres today to ask about the opportunities available to them.

From today:

  • Businesses can now take on under 25s, with 160,000 wage incentives worth up to £2,275.This process has been made simple for businesses and the amount is more than enough to cover an employer’s National Insurance contributions for employing a young person for a year.
  • An extra 250,000 work experience places will be provided over the next three years. Every 18 to 24 year-old Jobseekers Allowance claimant who wants one will now be able to take up a placement before receiving more intensive support offered through the Work Programme.
  • An extra 20,000 incentive payments will become available to encourage smaller businesses to recruit their first apprentices and, from the summer, extra support for the most disengaged 16 and 17-year-olds in England.
  • Extra resource will also allow advisers based in each of the 741 Jobcentre Plus offices to spend more time working with young people and provide a National Careers Service interview.

Britain’s biggest businesses are crucial in tackling the shared goal of getting young people into work and training.

Today it is being announced that a group of Britain’s biggest companies, spearheaded by Morrison’s, are signing up to the Youth Contract to get 50,000 unskilled young people into work over the next three years. The 16-24 Alliance has the ambition of dramatically bringing down youth unemployment. The Alliance includes Morrison’s, E-On, Phones4U and Barclays.

One way that companies from the Alliance can help is by taking on unemployed young people through the Youth Contract wage incentive. But instead of banking the money, the funding will allow the alliance to invest in specialist charities to train up and support young people who lack the skills for the world of work.

Deputy Prime Minister Nick Clegg said:

We’re determined to tackle youth unemployment and set young people on the path to work before long-term damage is done.

Today is a major moment for Britain’s unemployed young people. The message is clear - if you’re under 25 and don’t have a job, we are putting the money in to get you earning or learning through the Youth Contract. If you want to work or train, then we - together with businesses - will help you.

Big business has a huge role to play in getting young people into work and I’d like to congratulate the 16-24 Alliance for committing to using money from the Youth Contract to help the young people who need it most to join the world of work.

Employment Minister Chris Grayling said:

Youth unemployment is one of the biggest challenges this country faces and we’re determined to make a difference to a problem that’s been building up for much of the past decade.

What we’re offering through the Youth Contract is real practical support to both employers and job seekers which we hope will give young people a head start in the labour market.

The package of measures has received widespread support from businesses and builds on policies including the Work Programme and work experience placements.

Skills Minister John Hayes said:

By reviving apprenticeships, this Government is helping thousands of young people discover the purposeful pride that builds successful careers, thriving firms and strong communities.

In the past smaller firms have been deterred from hiring an apprentice due to perceived logistical, training and administrative costs but the new incentives of £1,500 are encouraging SMEs to give thousands of young people a great start to their working life.

John Cridland, CBI Director-General, said:

The Youth Contract is a great way of encouraging more businesses to take on young unemployed people up and down the country.

Youth unemployment is a real concern, and by helping firms cover the costs of employing and training a young person, the Youth Contract should make an impact where it matters.

John Longworth, Director General of the British Chambers of Commerce, said:

Business isn’t just good for Britain - it’s good for young people, too. Companies tell me they are ready to play their part to support the next generation into work, since young people are vital to future business success.

Yet for too many businesses, economic uncertainty has made it tough to hire more young people over recent months. Companies are concerned that many lack basic skills or past work experience. That translates into higher training costs and greater risk for employers.

The Youth Contract will significantly reduce those risks, and give employers more confidence to invest in young people.

Barnardo’s Chief Executive Anne Marie Carrie said:

Barnardo’s is committed to being part of the solution when it comes to providing tailored, dedicated support to young people looking for work. We see our participation in the Youth Contract as vital because of our expertise in transforming the lives of those most in need.

Notes to editors:

  1. Measures available from today in the Youth Contract include: * Cash payments of up to £2,275 to encourage employers to recruit young people aged 18 to 24 on the Government’s Work Programme. * An extra 250,000 work experience places over the next three years, taking the total to at least 100,000 a year. * Up to 20,000 new Apprenticeship Grants for Employers worth £1,500 to encourage new employers to take on new 18 - 24-year-olds, taking the total to 40,000 in 2012/13. * Additional support worth £126m in England to help 55,000 of the most disengaged 16-17 year olds participate and stay in education, apprenticeships or a full time job with training. * Business organisations supporting the Youth Contract include the Confederation of British Industry, British Chambers of Commerce, Federation of Small Businesses, National Market Traders Federation, and the Chartered Institute for Personnel and Development. * Measures in the Youth Contract build on successful schemes already in operation. More than 34,000 young people have already benefited from a work experience programme. Of the earliest participants, half were off benefits in 13 weeks. Placements are voluntary. * More than 3,000 people have also taken part in placements which include work experience, training and a guaranteed job interview in a sector where there are currently employment opportunities. * Employers wanting to get involved can find out more by visiting the Youth Contract website - * To make the wage incentive easy for employers to take up we have worked with businesses to keep the claim form as simple to complete as possible.

Updates to this page

Published 2 April 2012