Helen Whately is the Shadow Minister for Work and Pensions. Lana Hempsall is a Policy Fellow at Onward and founder and director of the Welfare Information Network.
Across Britain, a quiet crisis is unfolding fast. The number of young people who are not in education, employment or training is rising sharply, and ill health is the leading cause. Around sixty per cent of NEETs now cite poor health, and nearly half claim to have a disability.
This has had a dramatic economic effect, with costs to the Exchequer for benefits expected to rise to £100bn a year by 2030. The Government has attempted to change this, but their most recent attempt in the Budget falls short of what is needed for the chancellor to not have to raise taxes in budgets to come.
However, the issue is not just economic. This dramatic rise in NEETs is a profound social warning that an entire generation’s potential is at risk of being lost.
Whether these young people are genuinely too unwell to work, believe they are, or have been told they are, the result is the same: too many are drifting away from education and employment, often indefinitely. The longer they remain outside the workforce, the harder it becomes to return.
The problem is most acute among young women. Research from the Resolution Foundation shows that the majority of NEETs citing ill health are female, many reporting mental health challenges or caring responsibilities. For some, this may reflect the rise in young mothers or informal carers who find themselves isolated and unsupported. For others, it is the shadow of the pandemic, which appears to have eroded confidence among the young.
Whatever the cause, the pattern is clear. A growing number of young women are being locked out of opportunity by ill health, low confidence, or the absence of practical routes back into work.
This marks a deeper cultural shift in how health and work are understood. Over the past decade, Britain has seen a sharp increase in diagnoses of special educational needs and neurodiversity. Many young people leave school having received extensive support but with little preparation for what comes next.
Workplaces cannot offer the kind of unlimited flexibility that appear to be on offer in the classroom – particularly at a time when unemployment has risen to five per cent. And because moving to welfare support is now easier than ever before (often not even requiring an in-person interview or any requirement to seek work) it is easy for large numbers of people to end up out of work with little incentive or prospect of getting a job.
This is not an argument against support or diagnosis for those with mental health conditions. Rather it is a call for urgent action to find a solution that helps young people move into employment with confidence and support but also with effective financial incentives to make it worth their while.
The welfare system has also become a decisive factor. Universal Credit was built on the principle that work should always pay. But for those who can find a way to qualify for Personal Independence Payment (PIP) or the health element of Universal Credit, that principle has eroded. In some cases, the combined value of these benefits, alongside housing or council tax support, exceeds by some way the earnings for any kind of entry-level job.
These health related payments exist for good reasons for those with genuine and serious conditions. But they cannot be a way for those with minor mental health conditions to exclude themselves from ever having to work. Moreover, once an applicant has had their PIP or Universal Credit claim accepted, the fear of these benefits if they take on part time or temporary work acts as a powerful disincentive to apply for jobs.
Britain needs to restore confidence that work and support can coexist. Benefits must not trap young people in inactivity. The system should also make a clearer distinction between those with severe, long-term disabilities and those with temporary or milder mental health conditions. True compassion lies in empowerment, not dependency.
Some government programmes show potential avenues to achieve this. The Kickstart scheme, though imperfect, gave thousands of young people valuable experience. The Restart programme offered a more targeted model, providing sustained, personalised support to help people back into work. Local initiatives such as Southampton Football Club’s employment and mentoring scheme also demonstrate how coaching and structure can rebuild confidence, routine and resilience. Over three months, participants develop the habits that make work possible and often go on to thrive.
These examples show the power of early assessment, mentoring and accountability, and the lesson is clear. There is no single fix, but successful models share common features that could form the basis of a national framework for transition-to-work programmes, adapted locally but guided by evidence.
The Government’s Access to Work scheme is another area in need of reform. Designed to help disabled people enter or remain in employment, it has become slow, inconsistent and bureaucratic. Some applicants wait months for assessments or payments. Others receive open-ended support packages with little oversight. At its best, the scheme is transformative; at its worst, it spends heavily without delivering lasting independence. As technology advances, from AI-assisted tools to accessible digital aids, there is an opportunity to redesign Access to Work for the 2020s so it is faster, more transparent, and focused on outcomes rather than process.
Reversing the rise in youth inactivity requires a dual approach. First, fix incentives so that work always pays while reducing the fear and complexity that surround returning to work for those on health-related benefits. Second, build capability by investing in locally-led programmes that help young people with mental health or neurodiversity challenges make the transition into employment.
Early, school-based assessments could flag those at risk before they leave education; partnerships with small businesses, charities and local authorities could provide placements that combine real-world experience with mentoring. The focus must be on empowerment, not labelling.
Ultimately, this is about expectation and opportunity. Britain cannot afford a welfare model that writes off tens of thousands of young people as too anxious or unwell to contribute. Nor can it sustain one that rewards withdrawal over participation. We need a new social contract that combines empathy with ambition. Young people deserve support, but they also deserve belief in their potential. With the right incentives, programmes and mindset, we can turn today’s inactivity into tomorrow’s opportunity.
The challenge is not that Britain’s young people are unwilling to work. It is that too many have been allowed to believe they cannot. Changing that belief, through reform, opportunity and trust, has now become one of the most important social challenges we need to fix.
