Youth Unemployment

Shivani Raja Excerpts

Wednesday 28th January 2026 Commons Chamber

[Shivani Raja (Leicester East) (Con)]

Every young person I speak to in Leicester wants the same basic things: to work, to earn, to learn and to build a future for themselves. They want the dignity that comes from that first pay packet, the confidence that comes from responsibility, and the chance to prove themselves in the workplace. They do not want to sit on the sidelines of our economy and—let us be honest—we do not want that for them, either.

I hear constantly about the Government’s ambition—their ambition for more people to be in employment, the ambition for this and that—but ambition does not create jobs. It is not just the Government who have ambition; young people have ambition. They have the ambition to succeed, to buy a house with their wages, and to raise a family. Ambition is not lacking among our young people, but ambition does not create jobs. Jobs exist only when employers can afford to take on people, or to take a risk on expanding or on starting a business, and right now, this Government’s policies are making that harder, not easier.

What young people lack are opportunities. Entry-level jobs are disappearing, not because young people are unwilling to take them, but because businesses are increasingly unable to afford the risk of hiring them. This Government repeatedly underestimate how employers respond to rising costs. I know that those on the Government Front Bench and a large section of Government Members have never worked in the private sector and will not understand the risks of starting a business or working in the private sector. I know that they have never had to meet a payroll date, or had sleepless nights thinking about whether there is enough cash for them to take any salary at all, or about whether taking on another member of staff will cripple them.

I come from the private sector, and I understand businesses—my family runs its own businesses—so let me help Government Members to understand. Higher employer national insurance, rising business rates and increased regulatory risk all feed into the same calculation. When margins are tight, businesses do not take chances; they prioritise experience over potential. That is rational behaviour, but it locks young people out of the labour market.

As we have heard, youth unemployment stands at 15.9%, and nearly 1 million young people are not in education, employment or training. That is not because young people have stopped trying; it is because the number of entry-level opportunities available to them is shrinking. Retail, hospitality and leisure are where many young people learn how to work. They learn reliability, communication and resilience. Those sectors operate on tight margins and employ a disproportionate number of young people, yet they are precisely the sectors being squeezed the hardest by this Government.

Business groups have been clear about this. Yesterday, we heard the Government announce further changes to business rates, including additional relief for pubs. Any support for struggling businesses is welcome, but temporary discounts, transitional reliefs and future reviews do not change the fundamental problem. Costs are rising faster than confidence, and uncertainty discourages hiring.

In my constituency, claimant counts already sit above the national average. The number of young people aged 18 to 24 claiming unemployment-related benefits has risen over the past year. That is hardly surprising, given that businesses tell me that they are scaling back entry-level recruitment in response to rising costs. The story I hear again and again is the same: employers want to grow, but they cannot justify the risk. When the door to work closes, young people do not suddenly stop wanting to contribute. Instead, they are pushed towards welfare—not because they choose dependency, but because opportunity has been taken away. That is how a benefits system becomes a waiting room, rather than a springboard. This matters, not just economically but socially. Without early work experience, young people struggle to progress; skills fade, confidence falls, and the distance between them and the labour market grows. That is how temporary unemployment becomes long-term disengagement.

This does not have to be the outcome—there is another way to get young people back into work. We Conservatives believe that the answer is not to manage decline through temporary reliefs and reviews, but to remove the barriers that stop businesses from hiring in the first place. If this Government are serious about tackling youth unemployment, they must stop focusing on managing the consequences of higher costs and start removing those barriers, which means backing small and medium-sized businesses, reducing the cost of employing people, and ensuring that our tax and regulatory system rewards job creation rather than punishing it. Young people want to work, they deserve the chance to work, and it is the responsibility of this House to ensure that Government policy opens the door to opportunity, rather than quietly closes it.