Youth Unemployment

Jayne Kirkham Excerpts

Wednesday 28th January 2026 Commons Chamber

[Joy Morrissey]

This is a youth unemployment crisis of Labour’s own making. It is because of the national insurance tax hikes and the restrictions on business—

[Jayne Kirkham (Truro and Falmouth) (Lab/Co-op)]

Will the hon. Lady give way?

[Joy Morrissey]

I will make some progress. The crisis will continue to be a problem that this Government face—mark my words.

Turning to my constituency of Beaconsfield, Marlow and the South Bucks villages, we have an incredible restaurant in Beaconsfield called The Greyhound. I strongly urge everyone to go to eat there. It has a wonderful apprenticeship programme that helps young people get their first job in hospitality, providing them with an incredible opportunity. I went to speak to them and they said, “This is great. I wasn’t enjoying school and I now have an opportunity for a career in hospitality. I am trained in every level of hospitality.” They gave me a tour of the wine cellar and everything in between. They love it and are passionate about it.

The Greyhound tells me, however, that many businesses, and not just The Greyhound, cannot continue their apprenticeship programme because of the backdrop of the national insurance tax raid and an eye-watering hike in their business rates. They simply cannot continue the very successful programme that has changed young people’s lives.

This is a Government who failed to listen to the urgent calls of businesses to stop their Employment Rights Act, which will destroy jobs while creating rights for jobs that will no longer exist. Young people need businesses to be able to create jobs for them and not be hamstrung by tax and employment policies that force employers to curtail opportunity. This is also a Government who sow utter chaos in our apprenticeship system at every turn.

With Labour Governments, rising youth unemployment —indeed, all unemployment—becomes a sad inevitability. Yet different choices can change that course for our young people and create a better future. Lowering business taxes to enable businesses to create jobs will help tackle the problem, as will putting evidence before ideology in education so that standards rise and do not collapse, and scrapping business rates on the high street. We will see many people coming back, many businesses coming back and many young people being employed. It will be a tremendous win for this Government if they try that.

The Government should also try reducing the tax burden for anybody under the age of 25. If they scrap the national insurance contribution for under-25s, this Government will see a tremendous rise in young people taking their first job with a business, because the risk is reduced for that business. Instead, we are forcing over-regulation on to businesses, crippling and closing them, and curtailing opportunities for young people. We should create an apprenticeship system built on aspiration that is about employment choice and stability, so that we continue to build on the great work that had already started and give young people an opportunity to get their first job and start their career. That is the future our young people deserve.

--- Later in debate ---

[Graham Stuart]

The hon. Gentleman makes a fair and reasonable point, but if he goes back and looks through the data, he will see that youth unemployment stayed stubbornly high under the last quasi-socialist Government, and it was not just because of the 2008 crash. The truth is that, throughout that period, we had a much higher level of youth unemployment than we should have done. He says that we had austerity, but the then Government overspent. We inherited a massive deficit and slowly brought it down throughout the 2010s, but we overspent in each and every year, so the idea that we had austerity is a myth. “Austerity” means living within our means, but we did not live within our means. We overspent each and every year, but by the time we got to covid, we had managed to get our deficit right down. We showed fiscal responsibility, because we know that if Governments spend money that they do not generate, they impose a burden on the very young people on whom unemployment is now being imposed.

I will deal with the minimum wage, which Labour Members have touched on. They asked whether we want to tell young people that they are not worth higher pay. Well, if they do not have the experience, and if they lose out on getting a job against an older person because they do not even have cost competitiveness, they are in trouble. Since the introduction of the development rate in 1998, there has been a lower wage for younger workers. That is deliberate, for a very sensible reason: when young people enter the workplace, they are doing exactly that—they are developing. They are developing skills, confidence, discipline and the ability to work productively alongside more experienced colleagues. Employers were explicitly permitted to pay less in order to reflect an economic reality.

[Jayne Kirkham]

rose—

[Graham Stuart]

I do not doubt the good intentions of the Labour party, the Cabinet and the hon. Member for Truro and Falmouth (Jayne Kirkham), who I may allow to intervene in a moment, but good intentions do not disguise the truth. They have not run businesses, and it shows. They do not understand how employers make decisions or how behaviour is incentivised. By abolishing the development rate, the Chancellor wanted to signal that she is on the side of young people in order to put in place a political divide: “You Tories don’t want to pay young people a fair and decent wage!” Of course we do, but we want them to have jobs. This is the insider-outsider issue that my right hon. Friend the Member for East Hampshire (Damian Hinds) touched on earlier.

The effect that the Chancellor has had is the opposite of what she desired, and she is not helping young people. Many have received a short-term pay rise, but hundreds of thousands have received the ultimate kick in the teeth. They have received not a pay cut, but no pay at all, because the jobs they should have been offered have disappeared in a puff of the Chancellor’s smoke.

After the Government’s first Budget, a survey by the Beverley and District chamber of trade found that 88% of its members said they would be less likely to employ young people because of the rise in the minimum wage. Despite that warning, the Chancellor returned with a second Budget and destroyed even more opportunities with another £26 billion tax raid. We can but pray that she is out the door before she completes her tax-taking trilogy. If the Chancellor changes nothing, we need to change the Chancellor.

What would the Conservatives do differently? We would start with a simple truth: jobs are created by employers—by not Ministers, schemes or programmes. Private employers are the ones who generate wealth. The ladder of opportunity is not built by ministerial good intentions; it is built by creating incentives for the behaviours we want. The behaviour we want from employers is for them to take a risk, and to feel that it is worth their while for their family to invest in and give an opportunity to a young person. But under this Government, the first rung of the ladder is being sawn off. Young people do not begin at the top; they begin with a Saturday job or a summer shift, and their first payslip. That is where confidence is built, habits are formed and futures are forged. When those jobs disappear, the ladder does not get longer; it just gets shorter and steeper.

A Conservative Government will abolish business rates for retail, hospitality and leisure—not 10% of them, but 100%. Those are the sectors in which so many young people take their first step. Cutting costs gives businesses the freedom to grow and hire, and we do not need a vast number of people to administer a scheme. When we simply lower the costs for employers, they get on with it. That will create real opportunities for young people to learn, earn and prove themselves.

Under Labour, businesses face another three years of higher and higher costs, heavier regulation and constant uncertainty, leaving young people blocked, frustrated and struggling to get a foothold in the job market. We will repeal Labour’s job-destroying Employment Rights Act, because we cannot regulate our way to prosperity. The Act introduced 28 major reforms—count them—placing significant new requirements on businesses. By the Government’s own estimate, it will lead to £5 billion in costs.

The planned changes to zero-hours contracts are perhaps the most damaging to young people, because employees will require guaranteed hours and compensation for cancelled shifts. I fully accept that these measures are well-intentioned, but they will reduce the flexibility that employers value, and that young people also value because they can balance their studies with gaining experience. Businesses will hire fewer young workers, leaving a generation without the chance to learn, earn and prove themselves.

[Jayne Kirkham]

rose—

[Graham Stuart]

I hope the hon. Lady will say now on the Floor of the House that if the youth unemployment rate continues to go up, as it did under previous Labour Governments, from the 14% inherited from the Conservatives to 20%—if that were to be the terrible outcome, with its scarring impact on young people—she would not seek to stand for the Labour party at the next election, because she would recognise that she had failed us.

[Jayne Kirkham]

As an ex-employment lawyer—in fact, I was an equity partner in a law firm that employed 50 people, so I do have some experience—I remember that when the minimum wage came in in 1998, the figure for over-21s was the same, but the Conservative party changed that, so that those under 25 were paid less, although people’s rent does not cost less when they are 24. There is still a differential for under-21s of £2 an hour, so how can the right hon. Member say that that differential is no longer there when it still exists?

[Graham Stuart]

The differential has been eroded, but the hon. Lady is quite right to mention that. What we are talking about is balance. None of us is talking about a total free-for-all for employers. We are looking at getting balance, and it looks as though that balance has gone wrong, as the hon. Lady must know. What have been the great external economic shocks over the last year and a half? There have not really been any. There is no reason, other than the policies of this Government, for this increase in youth unemployment, with the loss of nearly 100,000 jobs in hospitality. This is about getting the balance right, and this Government have not done so.

The Conservatives will align incentives, cut costs and free businesses to hire—to get the balance right—and in doing so, we will give them the freedom to give young people a chance to prove themselves, because Conservative Governments stand for work, not welfare, and for opportunity, not dependency.

--- Later in debate ---

[Lewis Cocking]

My right hon. Friend makes an incredible point, and that is precisely what businesses tell me. As I have said, it comes as no surprise to any of my constituents or businesses in Broxbourne—it is a surprise only to the Chancellor and the Labour party—that if the Government tax jobs more, there will be fewer jobs. The Opposition have been making that point. I am always surprised when Labour MPs come out and say that they have spoken to businesses in their constituency and everything seems fine. They should speak to businesses that have a Conservative MP, because they would hear a completely different message.

More people in decent, sustainable employment and a life off benefits is better for our economy and our public finances. To show young people that there can be a better future, we must change the economic model to reward employment properly and change our education system so that young people are prepared for the world of work.

We should be more creative about what we are asking young people to learn at school. Countless employers in my constituency have told me that, when they hire school leavers, they lack important skills such as writing an email, speaking with customers over the phone, and understanding basic finance and the language of contracts. It is not that young people today cannot or will not develop those skills, nor is it the fault of our brilliant teachers; the curriculum simply is not geared to preparing young people for work in the modern world. We should be inviting local businesses, entrepreneurs and employers into schools more regularly so that they can share their knowledge and experience to encourage students to think about how they can get their ideas off the ground and what it takes to run a viable business.

When I asked about this issue before, I was told by a Government Minister from the Dispatch Box that it is the Government who create economic growth in this country. Let me say gently to the Government that it is not they, nor us as MPs, who create economic growth in this country; it is all our constituents across the United Kingdom who take a risk, put their ideas forward, create jobs and economic growth locally, and employ lots of people.

In school, students could learn about marketing, economics, maths and law, all without knowing that they are actually learning those skills and all without a textbook in sight. That sort of system would help our young people to navigate the crucial period after leaving school and make them more attractive to employers. I have seen fantastic work at the Broxbourne school, which teaches a business T-level in which students go out into the world of work and have an apprenticeship alongside learning in the classroom. That is what we need to gear our education system towards: preparing young people better for the world of work in the 21st century.

I went through my whole education in the United Kingdom under new Labour and Tony Blair, and I remember Tony Blair saying that he wanted half of all young people to go to university. University might be the right choice for some young people in this country, but it is not the right choice for everybody. When I was choosing what I would do after school, the word “apprenticeship” was not even in the school’s vocabulary. There was no offer of an apprenticeship. School leavers then either went to university or fell off the edge of a cliff and did nothing. That record, from when new Labour was in power, is not one that I would be proud of; I think Labour Members need to reflect on what they did last time they were in government, because it clearly did not work then and it is not going to work now.

[Jayne Kirkham]

The hon. Gentleman must be really pleased, then, about the Prime Minister’s new target of two thirds of young people being in either higher education or apprenticeships and training.

[Lewis Cocking]

Of course I am pleased about that target, but anyone can stand at the Dispatch Box, set a target and make it sound good. We want action on the ground. The Government have been in power for 18 months, and when I speak to my constituents, including young people, they say, “We don’t see action.” We need to move faster and further on this.

[Jayne Kirkham]

The hon. Gentleman must also be pleased to see the further education White Paper, which will put some of those things into action.

[Lewis Cocking]

I would gently say to the hon. Lady that her party colleagues had 13 years to come up with a plan for government when they were in opposition. That paper should have landed the day after the general election; that is when the Government should have been getting on with it, not 18 months down the line. My message to the Government is clear: yes, make the obvious tax changes that businesses from all our constituencies are crying out for, but also show that you are serious about creating economic growth, tackling youth unemployment and bringing forward fundamental changes to education.