Labour was on Saturday night accused of presiding over an epidemic in youth unemployment as the number of under-30s claiming out-of-work benefits hit a record 1.08 million.
More than 2,000 young people are signing on every day under Labour, with 66,000 more on the dole than before Sir Keir Starmer moved into Downing Street in July 2024.
The analysis, in a report by the Centre for Social Justice (CSJ), raises the prospect of young people being ‘locked out’ of the workforce and relying on Britain’s burgeoning benefits culture.
This is despite the Chancellor promising to ‘fix the foundations’ of the economy when she took office last year, calling economic growth a ‘national mission’.
Tory MPs claim Labour’s tax hikes are drying up opportunities for young people and driving youth unemployment – which has shot up to over 14 per cent.
Young people are more likely to be on lower incomes and in sectors such as hospitality, which have been hit the hardest by Labour’s rise in employers’ national insurance. In total, 150,000 jobs have been lost in just one year under Labour.
The rise of artificial intelligence is also a factor – the number of new entry-level jobs has fallen by nearly a third since the launch of AI tool ChatGPT in November 2022.
But the CSJ’s report points to a greater dependence on benefits among young people.
Labour has been accused of presiding over an epidemic in youth unemployment as the number of under-30s claiming out-of-work benefits hit a record 1.08 million. Pictured: Chancellor Rachel Reeves
Entry-level jobs, once done by young Britons, are now filled by low-skill migrants flooding the job market.
It recommended bosses be required to advertise roles to British workers first before recruiting from abroad.
And former Work and Pensions Secretary Sir Iain Duncan Smith warned in the report that young people are resorting to benefits because of the ‘disincentive to work growing massively’.
He wrote: ‘We cannot allow another wasted generation to be trapped in dependence rather than independence and achievement.’
The most recent official figures showed the number of all adults claiming Universal Credit has hit a record eight million. The benefit helps with living costs and is available to employed people on low incomes, but also those who are jobless or unable to work.
The number of people on benefits with ‘no work requirements’ also ballooned to 3.7 million – up a million in just a year. It came as the BBC yesterday promoted a report which claimed people were ‘missing out’ on £24 billion worth of unclaimed benefits and government handouts every year.
Radio 4’s flagship Today programme raised the ‘awareness, complexity and stigma’ of claiming benefits as a barrier to people getting even more. It suggested seven million households were missing out on extra financial help.
It welcomed ‘progress being made’ by the Government in raising awareness to help more people claim benefits, despite the welfare bill being expected to hit £100 billion by 2030 – about double the UK’s defence budget.
The Prime Minister (pictured in August) was forced to scrap most of his planned welfare reforms in the face of a backbench revolt by Labour MPs earlier this year
The Prime Minister was forced to scrap most of his planned welfare reforms in the face of a backbench revolt by Labour MPs earlier this year. In a humiliating climbdown, he ditched his plans – set to save £5 billion a year – and passed measures which some critics warn will only increase costs.
Lee Anderson, Reform UK’s welfare spokesman, said young people were being ‘left to rot’. He said: ‘This country has a proud tradition of being a nation of workers, but this Government is turning us into a nation of shirkers.’
Shadow welfare secretary Helen Whately, said: ‘Thanks to Labour, this epidemic of worklessness risks condemning a whole generation to life on benefits.
‘Labour said they would help young people get into work but they’re doing the opposite. Opportunities for young people are drying up. Labour’s cocktail of waste, welfare and worklessness is a disaster for Britain.’
CSJ policy director Joe Shalam added: ‘The Prime Minister is right that having a million jobless young people is a moral and economic disaster. But unless ministers grasp the nettle of welfare reform, Britain risks writing off a generation.’
A Government spokesman said: ‘For too long, too many young people have been denied skills, support and opportunities needed to succeed in work. That’s why we’re investing £45 million in the Youth Guarantee trailblazer, ensuring every young person is earning or learning.
‘This is alongside reforms to the welfare system, which tackle the perverse incentives that trap people out of work by rebalancing Universal Credit, as well as £3.8 billion for employment support and the expansion of mental health services.’
