Chancellor Rachel Reeves has announced an £820 million funding package to guarantee paid work placements for 18 to 21-year-olds who have been out of work or education for more than 18 months, as part of a wider initiative to tackle youth unemployment across the UK.
The investment forms a central pillar of the government’s new Youth Guarantee Scheme, which will provide three years of support offering young people an apprenticeship, training, education or help to find a job.
The announcement comes amid growing concern about youth inactivity with nearly 946,000 people aged 16 to 24 currently not in education, employment or training.
To further boost early career opportunities, the wider Budget also allocates more than £1.5bn through the Youth Guarantee and the Growth and Skills Levy, alongside visa reforms designed to help UK businesses access global talent, an essential factor for tech-sector growth.
Sachin Agrawal, Managing Director for Zoho UK, commented: “As the UK strives to be a global technology superpower, investment in the next generation through the Youth Guarantee and the Growth and Skills Levy is an important step. Building digital skills throughout the workforce requires collaboration between government, industry and education, aligning investment with the most in-demand skills in order to build a strong talent pipeline that can drive UK tech forward.”
“We’re seeing the widespread adoption of AI across business, and that requires businesses to have access to skilled staff in key areas such as AI, data and software engineering to lead safe implementation and maximise the benefits. Alongside the Chancellor’s investment, it’s important for organisations to look internally, prioritising upskilling through education and training for employees to get the most out of digital tools within their business.”
“These steps will help progress the pipeline of future tech talent and contribute to the UK’s global tech ambitions.”
Reeves also announced the government would be funding a scheme to make apprenticeship training for under-25 at small and medium businesses ‘completely free’.
The job market remains particularly challenging for young people, with 2025 figures showing a decline in vacancies and fewer people on payrolls.
