UK — The Resolution Foundation has published a report titled "Take a chance on me," recommending targeted workplace subsidies and reforms to the youth jobs grant and apprenticeship levy. The recommendations aim to reduce youth unemployment in the UK, where the number of young people not in employment, education or training (Neets) has exceeded 1 million this year.

The report determined that reversing increases in employers' national insurance contributions (NICs) and reducing the minimum wage for under-21s would have limited effectiveness in helping young people find jobs. Researchers calculated that repealing employer NICs changes would have an underwhelming effect on youth employment because most individuals under 21 do not attract employer NICs. The report estimated that entirely scrapping employer NICs for under-25s would cost £5.1 billion and create 38,000 additional jobs for young people, at a cost of £132,000 per job created.

Regarding minimum wage changes, the report indicated that reversing increases for younger workers would result in an additional 15,000 young people finding work. However, it also stated that 230,000 16- to 20-year-olds already earning the prevailing rate would lose £379 million annually if minimum wage increases were reversed.

Instead, the Resolution Foundation stated that employers should have access to targeted workplace subsidies as the most cost-effective method to support young people entering the workforce. The report recommended increasing the youth jobs grant scheme from 20,000 to 80,000 annual places, which would create an additional 11,200 jobs each year. Researchers found that increasing the youth jobs grant would create 2,800 additional jobs at a cost of approximately £36,700 per job. The youth jobs grant provides companies with £3,000 to hire an 18- to 24-year-old who has received universal credit for six months or more.

The Resolution Foundation also recommended extending the jobs guarantee to young people claiming universal credit and seeking employment for 12 months or more. Furthermore, the report suggested limiting the apprenticeship levy to support workers under the age of 25. The report stated that apprenticeships for workers aged 19-24 generate £13-£15 of public benefit per £1 spent, compared to £7 per £1 spent for workers aged 24 and over. According to the report, ringfencing the apprenticeship levy for under-25s last year would have freed up £1.55 billion. This amount would be sufficient to fund 145,000 young apprenticeships and provide firms with an incentive of £2,000 each.

Lindsay Judge, research director at the Resolution Foundation, noted the increase in Neets to over 1 million, calling it "a sobering milestone." Judge stated, "But reaching for employer tax cuts to resolve this doesn't add up. Instead, the government should scale up their most cost-effective programmes: more youth jobs grants, a broader jobs guarantee, and reforming the growth and skills levy so that it supports young people who would benefit from it the most."