Rachel Reeves has announced a plan to offer guaranteed paid work placements to young people out of work or education for 18 months. This builds on last November’s ‘youth guarantee’ offering 18 to 21-year-olds in England access to apprenticeships, training, education, or job assistance.

Young people on Universal Credit for 18 months without work or education will get a guaranteed paid work placement. Refusal without a valid reason may result in losing benefits. These placements aim to build skills for full-time jobs and will involve private companies, with businesses expected to cover some wages. Government subsidies will support the scheme.

However, businesses now facing higher National Insurance Contributions and Minimum Wage increases may struggle to hire, with UK job vacancies at their lowest since the pandemic.

An estimated one-in-eight 16 to 24-year-olds are not currently in education, employment or training – around 948,000 people – according to the latest figures.