London: Youth unemployment in the United Kingdom has risen sharply, creating new challenges for the government’s plan to raise wages and remove age based pay differences for young workers.
Recent labour data show that about one in six people aged 16 to 24 are unemployed. The youth jobless rate has climbed to around 16 percent, the highest level in more than a decade. Overall unemployment has also increased, reflecting a slowing economy and weaker hiring activity.
The Labour government has pledged to move toward equal minimum wage levels regardless of age. As part of this effort, pay for workers aged 18 to 20 is due to rise to about £10.85 per hour, while the rate for those over 21 is set to increase to £12.71. However, economists and business groups warn that rapid wage increases may discourage employers from hiring younger and less experienced workers.
Businesses say rising labour costs, higher payroll taxes and economic uncertainty are forcing them to cut back on entry level hiring. Sectors such as retail and hospitality, which traditionally employ large numbers of young people, have reduced vacancies in recent months.
Some policymakers and central bank officials have raised concerns that sharp wage increases could be contributing to the rise in youth unemployment. In response, government officials are considering slowing the pace of wage equalisation while continuing to support fair pay.
Trade unions argue that young workers deserve equal wages and protection from low pay, while business leaders urge caution to avoid job losses. The debate highlights the difficult balance between improving earnings and protecting employment opportunities.
Experts note that the problem goes beyond wages. Young job seekers face increased competition from graduates, fewer stable entry level roles and changing workplace demands. Automation and skills gaps are also making it harder for many to secure their first job.
To address the issue, the government is exploring measures such as expanding apprenticeships, improving skills training and strengthening employment support programs for young people.
The rise in youth unemployment has become a major test for the government’s economic strategy as it seeks to support workers while maintaining job growth in a challenging economic climate.