From education to employment

Supporting Young People to Develop the Skills they Need to Thrive

Lizzie Crowley - CIPD

Young people increasingly leave the education system without any experience of work, seriously undermining their ability to develop the skills that employers value. There’s a critical need to strengthen vocational pathways into the labour market, as well ensuring that all young people can build these skills while in the education system.

The Changing Landscape of The Youth Labour Market

Over the past 30 years, the journey from education to employment for young people in the UK has shifted dramatically. More young people, particularly from diverse backgrounds, are delaying their entry into the workforce to pursue higher education. While this has increased academic qualifications, it’s also led to a significant rise in economic inactivity: 41% of young people are now classified as economically inactive, compared to 26% in 1992. At the same time, youth employment has declined, with nearly one million fewer young people in work today than three decades ago.

Decline in Earning and Learning Opportunities

The decline in youth employment is especially noticeable among full-time students. According to our latest CIPD report, Changing face of the youth labour market, the proportion of 16–24-year-olds combining education with work has dropped significantly. For 16–17-year-olds, this figure peaked at 42% in 1997 but plummeted to just 20% by 2024. Among 18–24-year-olds, the decrease wasn’t as steep, from approximately 40% in 1997 to 34% in 2024.

This trend is also reflected in the increasing number of young people who have never had a paid job (excluding seasonal or holiday work). Between 2004/05 and 2023/24, the number of young people aged 16 to 24 who have never worked rose by 635,000—a 31% increase.

The decline in combining work with education has significant implications. Previous research has shown that earning while learning reduces the likelihood of future unemployment and enhances lifetime earnings. Young people who work while studying are 4–6% less likely to be unemployed or disengaged from education and training, and they earn 12–15% more within five years than those who focus solely on academics.

Young People Today Are Increasingly Entering The Labour Market Without Any Experience Of The World Of Work

This means that young people today are increasingly entering the labour market without any experience of the world of work, seriously undermining their ability to develop the skills that employers value. Our employer surveys highlighted key concerns:
52% believe young people are not well-prepared for the workplace.
64% feel young people lack important social skills at work.
71% report that young people often struggle to understand workplace behaviour.
56% find young workers more challenging to manage compared to previous generations.
34% feel young people are not effective communicators in the workplace.

The Need for Alternative Pathways

Although young people today are better qualified, the advantages of higher education have diminished. With limited alternative pathways and fewer opportunities to combine earning and learning, many young people face a difficult transition into work. Employers increasingly value skills such as communication, teamwork, and problem-solving—skills that are projected to grow in importance—yet many young people enter the workforce lacking these abilities.

Apprenticeships offer a critical opportunity for young people to gain practical skills while earning, but the current system in England has largely failed them. Most apprenticeship roles are filled by existing employees rather than new labour market entrants, and a growing proportion are allocated to those aged 25 and above.

Despite a decade of policy focus, apprenticeships remain underutilised as a pathway for young people. CIPD analysis shows that participation rates for 16–24-year-olds have stagnated, at 6.8% in 2002/03 and just 6.4% in 2022/23. And, while T-Level development has been an important step towards strengthening the vocational route into the labour market, there’s significant issues like high dropout rates and low employer awareness. These need to be addressed if this pathway is to offer a viable alternative to the more traditional academic route.

Policy Reforms and Recommendations

The Labour Government has acknowledged many of these challenges and is taking steps to address them, including:
Curriculum review to ensure young people develop workplace-relevant skills.
Rebalancing apprenticeships toward young people by removing funding for some higher-level apprenticeships and creating foundation apprenticeships.
Introducing work experience and enhanced career guidance, with an entitlement to two weeks of work experience.
Launching a youth guarantee for 18–21-year-olds to provide access to employment support, apprenticeships, or training.

While these reforms are a step in the right direction, more ambitious action is needed to reverse the decline in apprenticeships, unlock new opportunities for young people, and establish strong vocational pathways into the labour market. That’s why we’re urging the UK Government to:

• Expand the youth guarantee into a comprehensive apprenticeship guarantee for all 16–24-year-olds.
• Provide enhanced financial incentives for SMEs to create youth apprenticeship opportunities.
• Develop a robust pre-apprenticeship training program to better prepare young people for vocational careers.

Looking forward, it will also be important to ensure that the proposed Growth and Skills Levy doesn’t further undermine apprenticeship opportunities. Skills England must engage closely with employers in its design to ensure that it strikes the right balance – boosting youth apprenticeships, upskilling the workforce, and meeting essential skills demands. A more adaptable levy, alongside an improved vocational education and training system, can lay the groundwork for greater business investment in the skills essential to the economy.

By Lizzie Crowley, Senior Skills Adviser at the CIPD


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