Reversing UK employment tax rises ‘would do little to help young people find jobs’

Ministers should reject calls to reverse employment tax increases as a way to boost jobs for young people in favour of extra funding for apprenticeships and increasing the number of youth support grants, according to a leading thinktank. The Resolution Foundation said an in-depth study showed a cut in employers’ national insurance contributions (NICs) and a reduction in the minimum wage for under-21s – measures demanded by business groups – would do little to promote the chances of younger workers finding a job. The independent thinktank said employers should have access to targeted workplace subsidies as “the most cost-effective way of supporting them to get young people into work”. The report said that, unless action is taken, a high number of young people not in employment, education or training (Neets), which passed 1 million this year , risked scarring the living standards of a generation. Last month, Alan Milburn, a former health secretary, presented the first part of a government-commissioned report on why an increasing number of people aged 16 to 24 have become Neets. The Resolution Foundation’s report – entitled Take a chance on me – is expected to influence Milburn’s final recommendations when he publishes a follow-up report in the autumn. Business lobby groups have complained that tax rises introduced by the chancellor, Rachel Reeves, since Labour returned to power have raised the costs of employment, with young people bearing the brunt of hiring freezes. …