the neet crisis: what can be done?
By William Collinson · 24th august 2026 · 7 min read· image: wikimediacommons.com
There is now widespread acknowledgement that the NEET (not in employment, education or training) crisis is one of the biggest challenges the British government faces today. One could hope this was due to the eye-opening research Alan Milburn conducted during his review ‘Young People and Work’, yet seemingly what has done more to cause this realisation has been powerful rhetoric proclaiming a ‘lost generation’, and the emergence of the striking figure of 1.01 million British NEETs. Regardless, the issue is now much more in the political limelight, and action must follow acknowledgement. While the policy aspect of Milburn’s review is set to be released in Autumn this year, his diagnosis of the issue points to several paths the government could take to tackle it. Some, seemingly, are already being pursued, but much more can be done. How could this reinvigorated Labour government approach this challenge?
Before we answer that question, it is worth revisiting why solving the NEET problem is so important. Improving transitions into work is a moral and economic requirement; collapsing living standards due to economic or educational detachment are deeply scarring to the individual, providing a less fulfilling life than they could otherwise live. Furthermore, the UK’s future economic prospects are seriously undermined if current trends continue.
Britain has an ageing population. Over the past 40 years, the number of people aged 65 or over has risen by 52%. Therefore, younger generations must increasingly pick up the tab to ensure the continued function of our society; how do you square this with a ‘lost generation’? Milburn has estimated that discarded potential and fiscal strains of the NEET crisis cost the UK economy a net £125 billion annually. While only 530,000 of our NEET population receive Universal Credit - just above half - it remains a substantial drain on the exchequer, one which could be combatted through positive action to help cut the ballooning welfare bill. Through supporting these young people in their transition into employment more effectively, welfare costs, and wider drags such as strains on the NHS, can be cut. This positive approach would cut welfare expenditure without taking it away from families and individuals who sorely need it, something Rachael Reeves' 2025 Welfare Reform Bill could justly be accused of. Solving the NEET crisis is a prerequisite of approaching the economic aspect of Britain’s greying population. To boost living standards for youth in the UK, and to start to confront the generational challenge of an ageing population, our politics must begin to focus upon the 1 million that form our ‘lost generation’. So, what are the possible solutions?
Expanding a Culture of Care
The first and simplest aspect that requires reform is the problem the UK has with providing reliable transitions from education to employment. The UK does not have a problem with shepherding school leavers into higher education. The issue lies in the transition into work. Indeed, according to the Health Foundation, 78% of those who escape being NEET do so by moving into work, a statistic which builds the case for the government's Youth Guarantee. Britain’s youth have a relatively high educational attainment, with the proportion of GCSE students in England who got a grade 4 or higher at 70.7% in 2026. Indeed, the tertiary education (degrees and equivalent qualifications) rate for 25- 34-year-olds has risen to 60%, well above the OECD average of 48%. Yet this continued improvement of the education levels of the British population has developed in parallel to the NEET crisis. Clearly, high achievement in education does not necessarily lead to employment. Therefore, the current educational system that is focused on attainment rather than a student's ultimate employment destination is conducive to the NEET crisis. Schools prioritise the achievement of qualifications – understandably, as this is what takes place within their gates – yet securing economic participation after graduation must play a greater role. How we measure the success of a public service shapes its delivery. A tweak of the system, where educational institutions are measured equally on academic attainment and employment destinations for ex-students, would have a significant impact on the NEET crisis. Expect a changing hierarchy of priorities for schools and colleges to have a central place in Milburn's imminent portfolio of policy suggestions regarding the NEET crisis.
A further significant reform that should be pursued is to reshape the objective of mental health treatment. Head to our article ‘swiping the ladder’ for more details. Support must be extended, alongside the present focus solely on treatment and subsequent discharge, to encourage patients towards economic participation in their own lives once discharged from care. Milburn’s research suggested that the health service, similarly to the education system, focuses too little on educational, training or employment outcomes, preferring solely to focus on clinical targets. This is understandable; institutions seek to measure themselves on what takes place within their doors, not once an individual has left. Yet once more, it appears the healthcare system is not designed to encourage active economic participation. This of course was never part of the NHS’s remit. Yet, as Milburn has identified, how we measure the success of a public service ultimately shapes its delivery. Indeed, in the NHS, funding models are activity-based and so reward clinical output. Accountability for economic participation once a patient is discharged does not factor in, meaning there is no incentive to focus upon it. Specifically, regarding mental health, structured and fulfilling work helps combat depression and anxiety in young people, as Milburn’s research has found. If treatment was able to encourage economic participation, potential future strains on the NHS could be lessened as discharged patients could go on to lead a stable life, centred around economic participation. Presently however, a patient could be discharged having received treatment, yet remain economically detached permanently, an outcome that has no bearing on how successful the treatment received is measured. This should be reformed, and would ultimately be positive for the NHS’s finances and the quality of its service. Increasing focus upon health institutions’ accountability for the participation of their discharged patients is a step in the right direction to combat this issue.
Burnham has certainly proven willing to focus on mental health as a key inhibiting problem. Indeed, in early August, plans to establish a network of nearly 200 community mental health centres and mental health A&Es by 2029 were announced. This is a positive move by the Prime Minister, but will he go one step further and install a culture of care in these new community centres and across the NHS more broadly, regarding the participation of discharged patients? Incentives to support ex-patients into employment, education or training should be fostered. This could help combat the public health crisis in mental health that has been identified as a large contributor to our present NEET crisis.
A third direction that would be effective in dealing with the NEET crisis would be the expansion of vocational and technical training. Burnham has channelled much of his early political energy in office into this issue, pledging to put academic and technical education on ‘equal footing’ and to offer children aged 14 and above (year 10+) technical and vocational courses that are responsive to the local job market. Burnham claims the scheme will include the opportunity for work experience and to form connections with local employers; this will be vital for the success of the programme, according to the Institute of Fiscal Studies (IFS). It is important to ensure that employers can engage with the design and delivery of these training programmes, to make sure that the skills they provide suit the employers' needs. Imran Tahir, a senior economist at the IFS, suggested Burnham may find it difficult to encourage active employer engagement in such training schemes, similar to the fate of T-level courses.
A further problem identified by the IFS are the risks inherent in early specialisation. Potential shifts in the local labour market demand, changing fortunes or desires of a budding employer or simply a change of heart for the student themselves means that the vocational and technical training schemes must remain flexible. Routes across disciplines - perhaps back to academic education, or to a separate technical education course – must be accessible and accepted by educational institutions. Students, especially at the young age of 14, should have the opportunity to specialise, yet must not be pressured into believing the path they have chosen is their only route into employment.
This link between the skills built through vocational courses and the prospective employers' needs is vital. Solving this would strengthen the process of transition into employment, a key contributing factor in the NEET crisis. Failure to solidify this link, however, will simply provide further qualifications which do not necessarily pave the way to employment. Furthermore, overspecialisation at a young age must be mitigated against. This can be done through maintaining the study of subjects such as English and Maths, as Burnham proposes to do. Yet an equally effective approach is to ensure the new vocational and technical education system remains flexible, both in accordance with the demands of the local labour market, and regarding the ability to switch back to academia, or across technical courses if a student so chooses. Broad brush declarations, such as putting vocational training on par with academia, must be fleshed out with substantive policy. Burnham has proven enthusiastic on this issue. He must equally prove effective.
Much More Than a Statistic
Labour has largely focused on improving vocational training, something in which this country has lagged behind international competitors for many decades. Mental health has equally received some focus as we have noted, but on both counts, Labour must be bigger and bolder. The present Youth Jobs Guarantee – of a six-month work placement or training scheme for those out of work and claiming Universal Credit - will only reach a maximum of 43,000 NEETS, a significant number but merely a drop in the water. The structural reasons for why Britain is such an outlier in its NEET rate must be tackled, and our current generation of NEETS must be supported with stronger government policy. Any proposals that increase the cost of hiring young – such as a rising youth wage or mandatory internship payment – should be put on hold to smooth the transition for Britain’s youth into the workforce. What is more important; to improve the situation or our employed youth, or to support those NEETs desperate for work into employment? Clearly, the latter is more pressing. Initiatives like the Youth Jobs Guarantee are desperately needed. Yet the focus should be upon slowing the growth of the NEET population from the source. This is done, largely, by developing incentives for improving youth economic participation across our educational and healthcare systems.
The second half of Alan Milburn's interim report, focused on possible policy solutions to the NEET crisis, will be released well before the new year. It’s publishment should constitute a watershed moment regarding Britain’s ‘wasted generation’, as Sir Keir Starmer dubbed it. Chiefly, measuring the success of educational and healthcare institutions – in this instance, largely regarding mental health – according, in part, to economic participation once an individual has left the institution, will establish a stronger incentive to foster participation. How we measure success shapes our institutions. This should be harnessed to ensure we do not continue down this path to an insolvable generational imbalance. While clear economic drags are resulting from the NEET crisis – a significant welfare bill, lost output and a strain on the NHS – the crisis remains a deeply moral one.
One million instances of dashed potential is certainly not just a statistic. It does not suggest failure by individuals to seize opportunity, but more a chronic lack of support. As we run down the clock to the next general election, and Milburn crosses the t’s on his policy report, it grows increasingly apparent that Labours approach to solving the NEET crisis could be a central part of progressive politics to come. Developing a duty of care that goes beyond the gates of our institutions, regarding improving rates of economic participation, is the key to any approach