UK companies struggling to hire young people amid cost pressures, MPs told

"Businesses are trying their level best to stay afloat right now. She said firms wanted to hire staff but the simple costs of that right now are really impacting them."

"That's the worst percentage score since we started this survey more than a decade ago. He said young people were losing out after employers switched tactics to alleviate cost pressures."

"When the cost of employing people increases, it changes behaviour. When we ask about whether they would be willing to employ someone with less experience or a lack of qualifications, our members increasingly say, as wages have increased and employment costs have increased we are looking for people who are more qualified."

British companies face severe recruitment challenges due to escalating labour costs, including minimum wage increases and employer national insurance contributions. Business leaders report that these financial pressures have squeezed profit margins and forced employers to prioritize experienced workers over young people. The British Chambers of Commerce predicts unemployment will rise to 5.5% this year, with young people bearing the brunt of job losses. Current statistics show 957,000 people aged 16-24 are unemployed. The Federation of Small Businesses reports that 26% of firms employed fewer workers in the final quarter of 2025, the worst figure in over a decade. Employers increasingly seek qualified, experienced candidates rather than taking risks on less experienced young workers, fundamentally altering hiring behaviour.

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