UK youth NEET numbers hit 12-year high, report warns of 'lost generation'

More than one million young people in the UK were not in education, employment or training (NEET) between January and March 2026, the highest level in more than 12 years, official figures show.

The Office for National Statistics (ONS) recorded 1,012,000 young people classed as NEET in the first quarter of 2026, representing 13.5% of all young people in the UK. Of those, about 613,000 were classed as economically inactive — not looking or available to work — and an estimated 400,000 were unemployed but seeking work.

A review led by former Labour minister Alan Milburn, published Thursday, warns that one in six young people could be NEET within five years unless action is taken. Milburn described the situation as a "perfect storm" of challenges and said: "We are at risk of a lost generation."

"The old contract in society was always you put in effort and got a reward, each generation would do better than the last — this contract has been broken for this generation," Milburn said. He said rejections after submitting dozens, sometimes hundreds of applications had become the norm for young jobseekers, and challenged the characterisation that young people were "work shy, snowflakes, soft".

"You put in an application dozens at a time, you hear nothing back, you just get rejected," Milburn said.

The review found that six in 10 NEET young people have never had a job, up from four in 10 in 2005. However, 84% of NEET young people surveyed said they want a job or training.

The cumulative cost of NEET young people to the UK economy is estimated at £125bn per year, according to the review. That includes £38bn a year in lost economic potential and £63bn a year lost due to economic "scarring", as they are less likely to work in the future, plus losses in tax revenue and increased health and benefits spending.

The report found no evidence of a link between migration and youth joblessness. It said the number of entry-level mid- and lower-skilled jobs in the economy has fallen by around 1.6 million over the past 20 years, and ONS data shows vacancies in hospitality have halved in the last four years alone.

Prime Minister Keir Starmer called the report "sobering" and said he would work with Milburn "on what more needs to be done" to tackle the problems.

Work and Pensions Secretary Pat McFadden said the review laid "bare the scale of the challenge and the root causes of youth unemployment we now need to confront". He said the government is "creating 500,000 opportunities for young people, including a Youth Jobs Grant for businesses starting next month, more apprenticeships, and subsidised employment to help young people get a foot on the ladder."

Shadow work and pensions secretary Helen Whately criticised the government's policies, saying Labour had "made it harder for a young person to take their first step into work."

Liberal Democrat Treasury spokesperson Daisy Cooper said her party "repeatedly warned that Labour's jobs tax would hammer job opportunities for young people and that their business rates hikes would kill off high street job opportunities."

Milburn said the problem in the UK was worse than in other countries, with the number of NEET young people three times higher than in the Netherlands and twice that of Ireland.

The interim report does not include potential solutions; those will come in a final report at a later date.