Young Graduates; NEETs
A tragedy in the labour market
My journey to find a job wasn’t a simple one. In the end I had 23 first interviews, 13 second interviews, and an unpaid internship to top it all off. It took almost a year of gruelling and unrelenting rejection week, upon week.
I tell you this not to invite sympathy. By any measure I was fortunate. Unpaid internships are an extreme barrier to social mobility - I was only able to do one because my parents could support me, and I could live with close family friends. If neither of those were true, I wouldn’t have been able to do one.
My experience in finding a job was hard, but the longer I look at the subsequent youth employment the more I realise I had it easy. That tight pipeline I managed to navigate has only been squeezed as the economy has struggled and the accompanying coverage has been extremely unfair.
The past few weeks have seen the headlines domestically dominated by Youth Unemployment. Everyone and their mother decrying the growth of NEETs (Not in Education, Employment, or Training), cue the telegraph comments about how these young people are lazy and how they need to get off their arses etc etc…
The reasons for NEETs is multifaceted but my overwhelming feeling is that of complete sorrow for young graduates now.
The hand-wringing about NEETs treats the symptom as a moral failing and ignores the disease. There are, to my mind, four reasons for the crisis, and they feed into one and another.
To start with the most obvious, the Economy. Every year nearly 1 million graduates leave university hoping for one of those long-fantasised about graduate schemes. They ideally have spent the last three years doing a variety of internships and running societies. But the brutal reality is that there is only about 10,000 of those vacancies around. The Institute of Student Employers has reported that the number of advertised graduate roles has fallen by about a third, to its lowest level since 2018.
The vast majority will not receive a place. This they will discover after 6 rounds of mind numbing Kafkaesque torture via psychometric and aptitude tests.
There are multiple reasons for this but the two clearest are the rise in employer National Insurance Contributions, together with a steep climb in the minimum wage. The result is that employers are markedly more reluctant to take on the youngest, least-experienced workers. And it is the young whom the wage floor has risen fastest for: the rate for 18-to-20-year-olds jumped 16.3 per cent in April 2025 and another 8.5 per cent in 2026, meaning a nominal rise of nearly 68% since 2020.
Alongside this Artificial Intelligence is hollowing out the junior roles first. A widely-discussed 2025 Stanford working paper, drawing on payroll records for some twenty-five million workers, found that those aged 22 to 25 in the most AI-exposed occupations had suffered a 13 per cent relative fall in employment since generative AI took hold, even as older workers in the very same jobs held steady or grew.
Layer onto this wage compression - when someone with four years’ experience costs barely more than a graduate - and the question every hiring manager now asks answers itself. Why take the graduate?
The second concern - and the most covered - is immigration. The Centre for Social Justice (CSJ) reported that the number of non-EU migrants on payrolls aged under 25 rose from 82,000 in January 2020 to 370,000 in December 2025 – an increase of 290,000. Over the same period, the number of UK-national under-25s on payrolls increased by just 11,000, while the number of under 25s NEETs surged by almost 200,000 to 946,000.
On the surface those figures look damning, and they have been waved about as though they settle the argument. The picture is a little more muddled, the number of EU-national under-25s on payrolls fell sharply as free movement ended and the post-Brexit outflow worked through. A large part of the non-EU rise is therefore replacing departed Europeans, not displacing young Britons.
However, it is fair to say that experienced workers from India, South Africa, Nigeria and elsewhere do compete for junior roles, because those roles represent a real step up in income and that reproduces exactly the experience-versus-graduate problem from above. But the causation the headline implies, that migration has displaced a quarter of a million young Britons, is far weaker than the number is made to sound.
Thirdly, and most structurally significant, is the falling value of university education. Graduates are quickly discovering that the value of a university degree has fallen considerably. Recent polling by The National Centre for Social Research reported that a third of people in England agree with the statement that “a university education is not worth the time or money”, almost twice the proportion when the question was last asked in 2018.
Interestingly Reform and Green voters were the most sceptical of the value of degrees — pointing towards the coalition of voters those parties have attracted i.e. disaffected young-left wing voters to the Greens and traditional socially conservative older (typically sceptical of higher ed) voters to reform.
Whilst it is true that a university education is less valuable I should highlight that of those 946,000 NEETs, only around 34.9 per cent hold qualifications equivalent to A-level or above, and just 10.6 per cent hold a degree.
The NEET crisis, in other words, is overwhelmingly not a graduate crisis; most NEETs hold qualifications below A-level. Rather it is a cascading problem. As more people become university educated employers - even for non-grad schemes - start expecting degrees and use them as a function to filter applicants. Therefore graduate jobs vanish, displaced graduates take most of the other junior jobs and experienced and migrant workers take the rest of them; and the least-qualified are pushed off the ladder altogether.
The fourth and most commonly blamed reason for NEETs is the drastic increase in benefits claims. The claim is that once a person is on UC combined with Personal Independence Payments (although also claimable in full-time work) alongside Housing Benefits that the total pay-out from the state is close to or higher than minimum wage, therefore we are fostering a benefits culture in which staying at home pays better than working.
Personally this is a red herring. The growth in UC claims is a symptom of the problem and not a cause. Whilst yes, there are pull factors in benefits paying close to minimum wage, I would argue that few are actually opting into a life on benefits. Rather they end up on benefits because they can’t find a job and get trapped in a system that rewards them for staying there.
I write all of this not to whitewash the NEET problem - there is indeed a problem in Youth Unemployment - nor to doom say about a failing economy - technically our economy is growing, although there hasn’t been significant GDP per capita growth (the stat that actually matters) it has been anaemic since 2008 and essentially flat since 2019.
Rather it’s to say that there is a slow, quiet sort of failure in the economy and youth unemployment is its most sensitive barometer, because when demand for labour weakens the young are the first to be frozen out and the last to be let back in.
This damage doesn’t wash out when the economy recovers (if it will, Argentina was one of the richest economies at the start of the 20th Century). A graduate who spends two years firing off six hundred applications does not simply lose two years. A long spell of unemployment early on leaves a permanent dent in lifetime earnings - wage scarring, the economists call it - and a cohort that comes of age locked out tends to stay a step behind for decades.
Which brings me back to where I began. The cruellest irony of all this is that the system has been optimised to filter young people out - six rounds, the psychometric gauntlet, the silence where a reply should be. I got my own job through the precise opposite.
At the end of my second interview, my would-be boss reached into his wallet and handed me twenty pounds. I asked him what it was for. “You have completed work by coming to this interview,” he said, “so I am paying you for it.” In that moment I knew I wanted to work for him.
I still have that twenty-pound note, four years on, and as long as I live I will not spend it. The tragedy is not only how rare that small act of decency was. It is how much rarer the door it opened has since become.