Government launches £1bn youth jobs drive to unlock 200,000 roles and apprenticeships

The Government has announced a major employment push to help young people into work. Backed by big and small businesses the plan aims to unlock 200,000 paid jobs and apprenticeships over the next three years.  

Michelin-star chef Tom Kerridge, who has trained many apprentices in his pubs, backed the plans. He said: “I welcome this announcement which will provide amazing opportunities to young people looking to get into this industry and others, to learn a trade and earn along the way.  

“I’ve trained apprentices in my restaurants, and I know what a great start it gives them in their careers. These incentives will give our industry a great boost.” 

The move comes as almost one million young people are currently not earning or learning, a rise of 248,000 since 2021. Apprenticeship starts among young people have also dropped by 40% over the past decade. 

Below, we break down what’s changing, when support starts, and who’s eligible. 

Quick overview of the changes 

• £1bn in new funding for youth jobs and skills. 

• 200,000 job and apprenticeship opportunities over the next three years. 

• £3,000 hiring bonus for employers who take on a young person out of work for six months. 

• £2,000 bonus for SMEs hiring new young apprentices. 

• New foundation apprenticeships in retail and hospitality from April 2026. 

• Jobs Guarantee expanded from ages 18–21 to 18–24. 

• New short “apprenticeship units” in areas like AI, solar installation and electric vehicle charging. 

• New Level 4 AI and automation apprenticeship launching this month. 

What the Government has announced 

Here is a round-up of all the changes the government announced this week.  

A new £1bn Youth Jobs Grant 

Businesses will get £3,000 for each young person aged 18–24 they hire who: 

• is on Universal Credit, and 

• has been looking for work for at least six months. 

This is expected to support 60,000 young people over the next three years. 

Jobs Guarantee expanded to 18–24-year-olds 

The Jobs Guarantee scheme is widening from 18–21 to 18–24. 

From autumn 2026, anyone aged 18–24 who: 

• is on Universal Credit, and 

• has been looking for work for 18 months, 

will be offered: 

• six months of paid work, 

• 25 hours a week, 

• paid at minimum wage, 

• with fully funded wraparound support. 

This expansion will create more than 35,000 extra jobs, bringing the total to over 90,000 Jobs Guarantee placements in the next three years. 

£2,000 incentive for SMEs hiring apprentices 

Small and medium-sized businesses will get £2,000 for each new apprentice aged 16–24 they take on. 

This sits alongside wider apprenticeship reforms aimed at creating 50,000 more apprenticeships. 

These bonuses can also be combined with the £3,000 Youth Jobs Grant if the young person has been out of work for six months. 

New foundation apprenticeships 

Foundation apprenticeships give young people a supported first step into work. From April 2026, foundation apprenticeships will be available in: 

• hospitality 

• retail 

These join existing foundation apprenticeships in: 

• engineering

• manufacturing 

• digital 

They are open to 16–21-year-olds, with employers receiving up to £2,000 to support each young worker. 

Short “apprenticeship units” for fast‑growing industries 

For the first time, employers will be able to use short, flexible training units to upskill young staff. These focus on areas linked to the Industrial Strategy, including: 

• AI leadership 

• Electric vehicle charging installation and maintenance 

• Mechanical and electrical fitting 

• Solar panel installation 

• Modular building assembly 

• Welding 

More units will be created with industry input. 

New AI and automation apprenticeship 

A new 18‑month Level 4 apprenticeship starts this month. It will train people to: 

• spot where AI can save time and money 

• use digital tools safely 

• manage AI systems in the workplace 

This comes as 7.3 million people in the UK lack essential digital skills needed for work. 

Why is this happening?  

The Government’s goal is to ensure that every young person aged 16–24 has the chance to earn or learn. 

Secretary of State for Work and Pensions Rt Hon Pat McFadden said: “Far too many young people are leaving education and not getting the chance to work. Acting on this issue of youth inactivity should be a cause that motivates us all.  

“The human cost is a tragedy. The waste of potential appalling. And the financial cost enormous.” 

With almost one million young people out of work or education, ministers argue the changes are needed to avoid long‑term “scarring effects” on health, earnings and career prospects. 

Overall, the Government is investing £2.5bn over the next three years, aiming to support almost one million young people and deliver up to 500,000 opportunities to earn and learn.