26 May 2026
The recent fall in youth employment is now approaching the decline seen during the Covid-19 pandemic and 2008 financial crisis, according to the Institute for Fiscal Studies (IFS).
The think tanks says that in the three years from December 2022 to December 2025, the share of 16- to 24-year-olds in payrolled employment fell by 4.3 percentage points from 54.9% to 50.6%.
In comparison, the decline seen over the Covid-19 pandemic was 6.5 percentage points, while the fall in the 2008 financial crisis was 5.4 percentage points.
The decline in youth employment in recent years is the primary factor in the highly publicised rise in the share of young people not in education, employment or training (NEET).
Jed Michael, Research Economist at the IFS, said: 'The fall in youth employment across the UK is likely to be setting off alarm bells among ministers – not least because we know that unemployment early in one's career can have lasting negative consequences.
'The job of the Milburn Review – set up to tackle the rise in NEETs – is made much harder by a lack of clarity as to what is driving the fall. While it does not seem to be down solely to a temporary cyclical downturn in the economy, more evidence is needed to understand the roles of minimum wages, youth mental health, AI and other factors. Without this evidence, expensive policies to reduce the NEET rate are shots in the dusk, if not the dark.'