There are around a million 16- to 24-year-olds in the UK who are “Neet”: not in education, employment or training. Why?
How long has this been a problem?
The proportion of 16- to 24-year-olds in the UK who are classified as Neets has been at 10% or above for most of the last 25 years. But the problem is getting worse – today, around one in eight young people are Neet – and stickier, too. The former Labour health secretary, Alan Milburn, set out the scale of the problem in an interim report of his review on Young People and Work in May. On present trends, the number of Neets is set to swell to 1.25 million within five years. A decade ago, the rate was close to the EU average, but Britain’s is now among the highest in Europe: it has nearly three times as many, proportionally, as the Netherlands, and double Ireland’s rate. Six in 10 Neets today have never had a job, up from four in 10 in 2005
How serious is the issue?
It is, in Milburn’s view, an “urgent national crisis” which, despite its importance, is too often taken for granted and ignored. Obviously, for those directly affected, it is a tragedy: it “is corrosive of life chances” – if you’re a Neet in youth, you’re about six times more likely to be economically inactive in midlife. Neets risk becoming a “lost generation”, permanently excluded from the workforce. But Milburn’s review also estimates the cost in the main welfare payments to young people at around £8 billion per year, and the cumulative annual social cost of the broader problem at £125 billion – more than we spend on education or defence. It is, he found, “fast becoming a strategic economic risk for Britain. We cannot complain about labour shortages, low growth, rising welfare costs and pressure on public services while allowing the talent of nearly one million young people to go to waste.”
Why is this happening?
Milburn’s report argues that there is no single explanation. Rather, it is down to a “perfect storm” of many factors. The education system, though recently improved, allows many vulnerable people to fall through the cracks as they transition to adulthood, rather than catching them. The welfare system acts as a gateway to “a life outside the labour market”: it spends roughly £25 on working-age benefits for every £1 spent on active employment support. As well as these long-standing problems, there are two other relatively recent developments. First, that “the first rungs on the old career ladder have weakened”. The youth share of the labour market has decreased even as employment overall has increased; entry-level roles have become less plentiful and more demanding. Secondly, Milburn identifies “one stand-out change”: a growth in ill-health, particularly mental ill-health. Disability rates among Neets have more than doubled over the past 15 years.
Why is ill-health growing?
In 2024 to 2025, 45% of Neets in the UK reported having a disability; nearly half of these are mental health problems, which have risen sharply – primarily anxiety and depression, and to a lesser extent autism and ADHD. Such trends were exacerbated by the pandemic, but predate it. Milburn rejects the idea that people are “softer” than in previous generations; rather, he says, “a growing number of people are in genuine distress, while the system is struggling to respond” – in part because of a lack of coordination between health and welfare. The official definition of a disability has widened; a diagnosis of mental illness often becomes a gateway to welfare and a life permanently outside of employment. This creates a vicious cycle: poor health reduces participation in work; reduced participation worsens health and the likelihood of return to work. The NHS often merely “certifies” poor mental health, rather than treating it and encouraging a return to work.
And why is work harder to get for young people?
The number of workers under 25 has fallen since 2000. Education has absorbed some, but the proportion of unemployed people has risen (from 9.2% in 2022 to nearly 16% now). For those aged 16 to 17, the impact has been “dramatic”. Routes into work have narrowed: Saturday jobs and apprenticeships have both declined. Half of youth employment is in three areas: retail and wholesale; hospitality; and health and social care. High-street retail has contracted; hospitality is struggling; social care is poorly paid, taxing and unpopular. AI and automation have also impacted jobs, and have helped to tighten the graduate labour market, with the result that graduates are snapping up lower-paid jobs, creating a “cascade” effect. Employers complain that the cost of hiring has risen, because national insurance and youth minimum wages have gone up. Applicants say the automation of recruitment is discouraging: Neets describe applications disappearing into a “black hole”, with no response. All in all, “detachment from the labour market among the young is growing”, Milburn warns.
What can be done to help them?
Milburn is due to unveil his recommendations on how to tackle the problem this autumn: he has called for “fundamental and far-reaching reform” to the education, welfare and health systems. He has also highlighted the need to expand vocational training, citing the fact that fewer young Britons are in vocational education compared with better-performing countries such as Germany and the Netherlands
What will the government do?
In theory, the Neets issue could be a major opportunity for Andy Burnham’s government: both a classic campaigning Labour cause, and an opportunity, as the PM has put it, to show that he is “really serious” about cutting welfare spending. On the other hand, backbench Labour MPs have in the past proved reluctant to institute any cuts at all to the benefits system: the rejection of modest reductions to disability and sickness payments in June 2025 proved a turning point in Keir Starmer’s tenure.
Lessons from the Netherlands
At 4.1% (compared with 13% in the UK), the Netherlands has one of Europe’s lowest rates of Neets. If Britain’s Neet rate were equivalent, 600,000 more people would be in work. So what makes the Dutch different? Young people there report similarly high levels of anxiety and depression, for example. One big difference, according to the Resolution Foundation think tank, is that young people in Britain who do not go to university are starved of other choices.
In 2024, just 22% of 18- to 21-year-olds in the UK were on vocational courses, compared with 35% in the low-Neet trio of the Netherlands, Denmark and Germany. There are also comparatively few demands made of Britons with health issues: in 2025, 84% of young people on universal credit for health were under no obligation to undertake “work-readying” activities such as volunteering, study or employment preparation. In the Netherlands, by contrast, a “no-engagement” approach is usually a last resort after training, rehabilitation and subsidised employment have been tried. Pat McFadden, the work and pensions secretary, highlighted this difference during a fact-finding trip to Rotterdam earlier this year, saying that it “reinforced” his desire to get welfare reforms across the line.
