Youth unemployment in the United Kingdom rose towards the end of 2025, with the number of young people not in employment, education or training (Neets) approaching one million, according to the latest data from the Office for National Statistics.
Figures for October to December 2025 show there were 957,000 Neets aged 16 to 24, up from 946,000 in the previous quarter.
The youth unemployment rate stands at approximately 15% for 16 to 24-year-olds, while overall unemployment has risen to 5.2%.
The recent rise in youth unemployment, following changes announced in the 2024 Budget by Rachel Reeves, including increases in the National Living Wage and employer National Insurance contributions, highlights the importance of policy decisions on labour market outcomes.
Some business groups argue that higher employment costs have made firms more cautious about hiring entry-level staff, particularly younger workers with limited experience.
David Freeman, joint head of the labour market division at the ONS said: “The final quarter of 2025 saw a slight increase in the number of young people not in employment, education, and training compared to the previous quarter. This was driven by higher unemployment, with more young people actively looking for work.”
Ben Harrison, the director of the Work Foundation at Lancaster University, said: “Today’s data is a stark reminder of the magnitude of the challenge facing young people and the Government.
“One in eight young people aged 16-24 are stuck out of education, employment, or training, with the overall number remaining stubbornly close to one million.
“Disabled young people are hit particularly hard, and there is a considerable risk that more young people will slip into long-term worklessness unless [the] Government acts to address the causes of this rise.
“Failure to do so could have damaging consequences, with previous studies suggesting that young people who fall out of work for health reasons could be more than £1million worse off over the course of their lifetime.
“The data indicates that more young people are now looking for work, with the number classified as ‘inactive’ down by 34,000 on the quarter.
“Although the number of young people in unemployment has risen by 45,000 over the same period, counterintuitively, this may reflect more young people moving closer to entering employment – but only if they’re able to find work.”
Labour market analysts emphasise that economic growth rates, sectoral demand shifts, and global economic conditions significantly influence youth employment trends, underscoring the complex factors at play.
The figures come as an estimated 900,000 graduates prepare to enter a job market that economists describe as more competitive.
Slower hiring, cost pressures on employers and reduced vacancies in certain sectors may increase competition for early-career roles.
Policymakers closely watch youth unemployment because prolonged joblessness early in working life can have long-term consequences for earnings, productivity and economic participation.
Much will depend on whether business confidence improves and whether companies expand hiring in response to economic growth in 2026.
The Spring fiscal updates and future labour market policies may also shape employer hiring decisions in the months ahead.
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