How has UK Economy unfairly treated young people for decades?

Pars Today – The annual report by auditing firm PwC on youth employment in the UK paints a picture of a structural crisis that threatens not only the future of the younger generation but also the country’s economic growth trajectory.

Analysts believe the root of the crisis lies in the UK’s economic model: one based on low-productivity services, concentrated wealth in the Southeast, and reliance on temporary jobs. Until this structure is reformed, government support packages will serve only as a short-term remedy, leaving young people as the primary victims of the structural weaknesses of the UK economy.

According to Pars Today, the UK’s drop of four places in the OECD’s youth employment ranking—landing at 27th—is a clear sign of the deepening crisis. Youth employment has reached its lowest level in a decade, and the most striking figure is the rapid growth of young people classified as NEET (Not in Education, Employment, or Training)—those aged 16 to 24 who are neither in the labor market, nor studying, nor participating in training programs.

For a developed economy like the UK, this is a serious warning about wasted human capital and widening social divides. Regional inequalities add another layer to the crisis.

PwC’s report, focusing on regional disparities, shows that the crisis is unevenly distributed across the UK, with some areas far more vulnerable. Regions like London and Scotland, despite having universities and advanced industries, have the highest rates of young people outside work or education. This paradox indicates that the UK’s economic structure is inefficient in linking higher education with the labor market, while high living costs and intense competition discourage active youth participation.

Clare Lombardelli, Deputy Governor of the Bank of England, said in a candid statement to the Treasury Committee that the data the Bank receives on the situation of UK youth is “alarming” and does not provide a clear picture of the future labor market.

At the macro level, the combination of high unemployment, underemployment, and rising long-term incapacity has heightened the Bank of England’s concern about a shrinking labor supply and declining productivity. Employers are also complaining about rising costs of hiring young people and warn that government support policies, without sufficient incentives, may lead to a further reduction in job opportunities.