The Department for Work and Pensions (DWP) has announced a new scheme offering £3,000 payments to employers who hire young Universal Credit claimants, aiming to tackle youth unemployment and enhance job opportunities. This announcement follows a written question posed by Liberal Democrats MP Dr Al Pinkerton about government support for young people entering the workforce.
DWP minister Andrew Western detailed the initiative, emphasizing the government’s commitment to youth employment through substantial funding. “Building on the Youth Guarantee and Growth and Skills Levy announced at the Budget, the Government is investing an additional £1 billion as of 16th March 2026,” he explained. “This takes the total investment in youth employment programs to £2.5 billion over the next three years.”
These funds are set to benefit nearly one million young people, creating up to 500,000 new “earn and learn” opportunities. The government is also supporting employers with measures such as a £3,000 Youth Jobs Grant for those hiring 18 to 24-year-olds who have been on Universal Credit for over six months. Additionally, a £2,000 apprenticeship incentive is available for small and medium-sized businesses hiring 16 to 24-year-olds, complemented by the Jobs Guarantee scheme providing fully funded six-month placements for long-term unemployed youth within the same age range.
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The support targets young claimants born between 2002 and 2008, recognizing the need to help this group transition effectively into employment.
Labour Party leader Sir Keir Starmer highlighted the significance of these efforts: “Backing young people is one of the most important investments we can make in this country’s future. We are committed to expanding practical routes into work, boosting apprenticeships, and giving employers the clarity they need.” He stressed the broader goal of closing the skills gap and fostering an inclusive economy that benefits everyone.
Praful Nargund, Skills Adviser to the DWP Secretary of State, added: “Too many young people have long faced barriers just when opportunity is most critical. We’re shifting apprenticeships to focus on young people and supporting employers who provide these valuable opportunities. Our goal is to build a system that empowers young people to shape their futures while driving economic success.”