UK Government Launches £3,000 Youth Jobs Grant to Boost Youth Employment

The UK government has introduced a Youth Jobs Grant that offers employers a £3,000 payment for each eligible 18‑to‑24‑year‑old they hire. The scheme targets more than one million young people who are not in employment, education or training (NEET) and is part of a broader strategy that also includes a Jobs Guarantee and expanded childcare support.

A report by the Resolution Foundation found that expanding targeted hiring programmes, such as the Youth Jobs Grant, provides better value for money than cutting employer taxes. The analysis noted that scrapping National Insurance contributions for under‑25s would cost £132,000 per additional job, whereas the Youth Jobs Grant would cost around £36,700 per job – comparable to the existing Jobs Guarantee.

Prime Minister Sir Keir Starmer highlighted the need for alternatives to university and urged employers in sectors like hospitality to take up the incentive. The grant’s effectiveness will depend on uptake and whether the jobs created lead to lasting employment for the NEET cohort.

"One million young people outside of work, education or training is a sobering milestone – the highest figure for 13 years," said Lindsay Judge, Research Director at the Resolution Foundation, emphasizing the urgency of focused interventions over broad tax cuts.