Centre for Social Justice says record 1.08 million under-30s claiming out-of-work benefits

A report by the Centre for Social Justice (CSJ) said on Saturday that a record 1.08 million people under the age of 30 are now claiming out‑of‑work benefits, a rise it described as evidence that a generation of young people risks being “locked out” of the workforce.

The CSJ analysis said more than 2,000 under‑30s were beginning claims each day and that the number of young people on benefits had increased by about 66,000 since the Labour government took office in July 2024. The report attributed the rise to a combination of factors cited by the CSJ and Conservative MPs, including falls in entry‑level vacancies, higher employer national insurance costs, and the impact of automation and artificial intelligence on low‑skill roles. It said youth unemployment had risen to more than 14%.

The CSJ recommended that employers be required to advertise roles to British workers before recruiting from abroad and called for welfare reforms to address what it described as growing disincentives to work. Former work and pensions secretary Sir Iain Duncan Smith, writing in the report, warned that without change a ‘‘wasted generation’’ could be trapped in dependence on benefits.

Conservative and Reform UK politicians cited the CSJ figures to criticise the Labour government. Reform UK welfare spokesman Lee Anderson said young people were being "left to rot", and Conservative shadow welfare secretary Helen Whately accused the government of fostering a ‘‘cocktail of waste, welfare and worklessness’’. CSJ policy director Joe Shalam said the scale of joblessness among young people was both a moral and economic problem and urged ministers to “grasp the nettle of welfare reform.”

A government spokesman disputed some of the characterisations in the CSJ release and pointed to measures the administration says are intended to help young people into work. The spokesman said the government had committed £45 million to a Youth Guarantee trailblazer to ensure every young person is earning or learning, was undertaking reforms to Universal Credit it said would remove perverse incentives in the system, and had allocated £3.8 billion for employment support alongside an expansion of mental health services.

The CSJ report also cited official statistics showing the total number of adults claiming Universal Credit has reached about eight million, and that those on benefits with no work requirements rose to roughly 3.7 million, an increase of about one million in a year. Separately, a BBC analysis cited in the CSJ-related coverage estimated that households were missing out on about £24 billion of unclaimed benefits and government handouts annually.

The report placed some responsibility for changing labour market dynamics on structural and technological shifts. It said the number of new entry‑level jobs had fallen by nearly a third since the launch of the AI tool ChatGPT in November 2022, and argued that higher costs to employers had hit sectors that typically employ younger workers, such as hospitality.

The document also noted a loss of roughly 150,000 jobs in the year since Labour took office, a figure cited by the CSJ and dissenting MPs. The prime minister’s office has previously faced internal disagreements over welfare reforms; the prime minister earlier this year abandoned most of his planned changes after a backbench revolt, steps that critics say altered the scale of projected savings.

The CSJ urged targeted policy action to prevent long‑term scarring of young people’s labour market prospects, while ministers emphasised investment in training, employment support and mental health services as their response. Both the CSJ and government statements said they viewed the situation as a priority for policy makers moving forward.