Pensions minister warns of 'moral crisis' after shocking rise in youth unemployment

Added: 2026-05-31

[00:00:00]Over a million young people unemployed and not in education or training and that's expected to rise. So today the government has announced 300,000 work experience placements try and tackle the problem.

[00:00:12]>> But a review commission by the government itself yesterday suggested wholesale change of the education and benefit system is the real answer to youth unemployment. Minister for pensions Tolston Bell joins us now. Good morning to you. There is a sense, isn't there, that this is a drop in the ocean when we're looking at that figure. Over a million young people not in education, employment, and training. They are out there now desperate to secure that first step on the ladder that will set them on the right path for the rest of their lives. We know we've had these warnings.

[00:00:43]We're risking a lost generation. And the offer from the government is work experience. That doesn't seem to be enough to tackle the problem. Well, good morning and it's lovely to be um with you. Look, I mean the bit I agree with you on is that this is a this is a big challenge for the whole country. It's a big challenge for the individuals affected and actually for their their parents. I hear from both individuals who are in their early 20s or late teens wanting to work and struggling to do so.

[00:01:10]But I also hear from their parents and I knock on their doors and they talk to me about the 24 year old who's upstairs in their bedroom not able to get the opportunities that they hoped and that they deserve and what that does to their hope but what also what it does to the parents seeing that happen to their children. So this is a national crisis.

[00:01:26]It's a moral one not just an economic one and we do need to fix it. Now today we're talking about one part of our action to deal with that. I'll come to some of the other ones later, but 300,000 extra uh work experience placements, making sure that people get the experience of working in sectors like construction, hospitality, retail, but also at our airports. McDonald's is also offering work experience because those of us that, you know, started work at 15 or 16, in my case, washing up in a pub, learned the importance of that, about learning about the world of work, learning how hard it is to keep up in a pub kitchen, but also just interacting with all kinds of people. It makes a real difference. one of the big >> does make a bit of difference to Bell but you know here's the thing um Alan Milbour ex Labor health secretary says Britain has lost I'm sure you agree with him 1 6 million low and medium skilled jobs hospitality jobs have harved in four years and apprenticeships are down get this 35% I mean isn't the real problem that the jobs young people used to start and you're talking about McDonald's and and other places just simply um aren't there anymore >> well look I completely agree with you that we have seen some big changes is in the labor market. We've got high levels of employment in Britain today. Overall, we've got higher last year we saw 75% roughly of Brits working. There's only been two years in the last 100 outside the Second World War where more people were working than that. But we have, as you say, got a concentrated problem about what's happening to young people.

[00:02:50]That's where we need to >> No, no, no. That's not that's not what I asked. Sorry, I'm so sorry. That's not what I asked. Where are the jobs going to come from when um there aren't those hospitality jobs there in in the first place? Um this is an issue as you you said from the beginning about the economy. Uh there are now as you know 1 million young people not in work, education or training. Now um uh you've increased or the Labor government have increased um national insurance and employment costs. The Office of Budget Responsibility says those tax rises will cost jobs. Um, why are you making it more expensive to employ people, especially young people in a youth employment crisis?

[00:03:30]>> Well, let me answer. There's about three questions in there, so let me try to answer one before the next set of questions uh uh start. So, look, where are jobs coming from? Well, actually, I see employers right across the economy who do want to employ young people.

[00:03:41]About 28% ofmemes have offered work experience or internships to people, young people in the last three years.

[00:03:47]We'd like that to be more, but that's great that they're doing that. I hear national companies who come to talk to us and want to do more. Like I say, McDonald's is offering 25,500 work experience placements and wants to offer more in the years ahead. The construction sector is a big employer of young people. It's true what you say that we have seen declines in some sectors. The retail sector has been declining now for about a decade in terms of the number of people it employs and that does have a particular effect on young people. But our job is to obviously buck that trend and other countries have managed that. The point you made about apprenticeships, I think, is really important. It's true that under the Conservatives, we did see a 40% fall in youth apprenticeships.

[00:04:23]That's because the system wasn't focused enough on what its core purpose is, helping the next generation get a leg up onto the ladder into the world.

[00:04:30]>> So, are you going to make it cheaper for employers? Are you going to make it cheaper for employers to uh employ uh young people? You know, reduce national insurance, make it easier for the hospitality industry, all of the first rung on the ladder. I keep you keep referring to it as if it's uh the the answer to young people, the type of McDonald's jobs you're talking about.

[00:04:50]>> No, no, no. The answer to young people is to get really good apprenticeships, whether that's in AI or in our health sector or in the construction sector, all over the place. We need all kinds of uh jobs. Look, directly on your directly on your question, as Alan Milbour said yesterday, we can see that this program, this issue, this challenge has been building right across the last two decades. It didn't happen in the last two years. Specifically on national insurance because you've raised it.

[00:05:10]Let's just be really clear. People who are aged under 21 don't incur any national insurance whatsoever for them to be employed. If you're an apprentice and you're aged under 25, there's no national insurance at all for exactly the reasons you're raising, which is we want to support employers to employ those young people. When you ask about >> point, sorry, let's not let's not um mislead people. It's because it makes it more expensive for pubs and the hospitality industry and uh shops etc. who've now got uh we we heard I think so from next about 20 people applying for for one job makes it more expensive to employ people especially the young people who you want to get into work.

[00:05:46]>> No no no let's just be really clear you don't pay national insurance an employer does not pay national insurance if they employ someone aged under 21. And I don't hear that mentioned enough when you're discussing that. Lord Wilson that you mentioned, we should all listen to big employers. He manages next, but he also is a conservative peer and he's on managing working with the shadow cabinet who don't obviously agree with what the government's doing. And stepping back, why are we having to raise Nash insurance? Because the NHS has to be saved. We've seen the biggest fall in waiting lists in 17 years. Why is that important? It's important for employers because if their employees can't get the treatment they deserve because the NHS is failing, then that hurts the whole economy. But this is a whole generation of young people that's potentially being lost. And it it is misleading, isn't it, to say that because you know the extra costs that are put on businesses, just because certain people are exempt from it, those costs that are put on businesses mean that businesses have to make decisions about the jobs that they offer and they're looking at the ones that they can lose and they're looking at those entry- level jobs. And that is why we've seen the decrease in the jobs on offer. Alan Milburn himself said yesterday. He said yesterday loading costs on businesses hasn't helped. He thinks that needs to be looked again.

[00:06:57]>> Look, I do think we should take seriously the cost that businesses bear, whether that's on energy bills or it's on tax and it's on regulation. I absolutely agree with that. But I can just look at the look at the data. What the data shows you clearly is that employment levels amongst young people fell in the 2010s and they never recovered to the high seen under the last Labor government in the 2000s. And it shows you that NEAT levels rose significantly from post pandemic through to through to today long before anyone had mentioned changes in national insurance. That doesn't mean they don't have an effect. I absolutely understand that. I talk to employers about that all the time. And government's job is to take decisions in the round as I say to make sure that we can rescue the NHS.

[00:07:36]But let me come on to what the government. We've got McDonald's and the construction sector. You talk about the economy uh in general. Um, one of the things that's been raised me by by Tony Blair amongst others is the triple lock state uh, pension which protects um, pensioners. Um, now before entering government you said that the triple lock and these are your words not mine were not a sensible mechanism. You also said there was no moral or economic justification for treating pensioners differently from working age people. Do do you still believe that?

[00:08:05]>> Yeah, I want to see pensioner poverty fall and I want to see child poverty fall. They both fell under the last Labor government and our job is to get both down now. And that's why we're making sure just next month there'll be a £3,000 hiring bonus for any firm that brings on a young person who's been unemployed. In the autumn, we'll introduce a 2,000 bonus for anyone that employ employs an apprentice aged under 25. We've got to absolutely the the lesson from the Milbourne report is that there is a moral challenge facing us as a country. Too many young people are being left behind and we need to do everything we can to support them. And that's about reform in our benefit system. It's reform to our labor markets and it's reform to our education and health systems too.

[00:08:41]>> Absolutely. Well, pensions minister tomb bail, thank you and you know the message was that it needs to be a priority because it's being seen as a crisis. So hopefully we will see more to follow on that one. Thank you for your time this