To ask His Majesty’s Government what assessment they have made of current business hiring intentions and their implications for the wider economy.

The UK labour market and economy remain resilient despite geopolitical uncertainties. The UK had the fastest growing-economy in the G7 in Q1 2026. On the labour market, ONS data shows that there are 416,000 more people in work than a year ago. Its business insights survey shows that over 80% of businesses intend to either maintain or increase their staff levels in June 2026.

I greatly regret to tell the House that the latest figures from the Office for National Statistics show that the number of young people not in training, education or employment has exceeded 1 million. I believe we are heading to figures for 18 to 24 year-olds which have not been seen since 2008 when, under the previous Labour Government, the future looked very grim. Recent measures were introduced by the Government, including the business-busting Employment Rights Act, the national insurance contributions—the list is endless, and if noble Lords would like to read them all, they are in the report of the unemployment adviser, Mr Alan Milburn, or the essay published by the previous Prime Minister. Will the Minister wake up and do something about this?

I do not accept the characterisation presented. We recognise there is a crisis of participation, and Alan Milburn’s interim report clearly laid out many of the contributing factors in health and education, which have been there for many years. Under the previous Government between 2021 and 2024, the number of young NEETs increased by 250,000. This is an issue that we are tackling. As I mentioned, in Q1 of 2026 the economy was one of the fastest-growing in the G7. We are taking actions on youth employment, supporting young people to get into work, supporting them with work experience, training and apprenticeships. This is exactly what we need to do in these circumstances.

My Lords, in a slightly calmer vein than the noble Lord, Lord Hunt, can I ask whether the Minister is aware that the ONS Labour Force Survey flash figures for April show a 100,000 reduction in payroll numbers? Does she think that this indicates that, as the year goes on, there will be an increase in unemployment, or does she think—as is so often the case—the ONS has got it wrong?

I do not know that my commenting on forecasts will necessarily add to the discussion. I am happy to talk about the actions we are taking to support the economy and young people especially to increase activity and get the experience they need to secure good jobs today and for the future. That is why we set out our modern industrial strategy and why we are supporting young people getting into training and apprenticeships. We have reformed the apprenticeship levy into a growth and skills levy to make it more attuned to the needs of business so that those young people can get jobs today.

My Lords, I talk to a number of businesses and work in very major businesses, and I see the issues that they are having about employing young people just now. When will the Government accept that, in addition to technology changes, the raft of legislation that makes it more expensive, more difficult and more risky to recruit young people is an issue? At what point will the Government look back and say, “We want growth, we want to employ young people and we want to give them a chance, so we will have another look at our legislation because we got it wrong”?

Where I can agree is that we want to create an economy where people feel confident to employ young people. I draw some figures and analysis to this House’s attention: under the last Government, between 2021 and 2024, the number of young NEETs increased by 250,000. I mention that because the noble Lord drew attention to measures that have happened subsequently, thus putting his analysis into question. Businesses are able to employ NICs reliefs for those under 21 and under-25 apprenticeships. I highlight those changes on NICs. Obviously, the NICs changes that came in last year do not apply to young people, so I do not accept the noble Lord’s analysis. I highlight to the House the measures we are taking to support young people and give them opportunities so that they get experience of work—employers mention that young people should have good experience of work in order to get their employability up.

My Lords, all the analysis of NEETs shows that the resilience of young people is an absolutely critical aspect of getting them into the modern labour market and labour force and keeping them working. The previous Government stopped, through austerity, many of the early evidence-based programmes that would build the resilience and the ability of young people to continue through difficulties. Any young person today will have huge difficulties, and we therefore have to make sure that we have those early intervention programmes to build the resilience of young people.

My noble friend is right to draw attention to the importance of many different contributors to the employability, ability and capabilities of young people. That is indeed around skills and training, which is why we are investing in further education and in matching skills with the modern industrial strategy, working with employers. It is also why we are paying attention to changes in provision on mental health and in early years, such as the expansion of free school meals, to provide all children with the best start in life.

My Lords, will the Minister tell the House exactly which part of the Employment Rights Act will create jobs and encourage employment?

The Employment Rights Act will benefit 18 million workers. Having secure employment where you know that you have the right to sick pay and that you can take leave when you have a family is an attribute of a modern functioning labour market.

My Lords, I am surprised that the Minister did not remind the Opposition that youth unemployment was 1.25 million in 1984. They are keeping quiet about that. What assessment have the Government made of the possibility that a freeze or a reversal of the state pension age could release jobs for younger adults?

That is a question that I personally have not put my mind to. I am happy to discuss it with my colleagues.

My Lords, 42 years on, I remind the House of my noble friend’s statistic that there are over 1 million NEETs at the moment. How depressing is that?

To follow on from my noble friend’s question, retail and hospitality are often young people’s first chance to enter the labour market, yet these are the sectors being hit hardest by the Government’s own policies. In April this year, the BRC, UKHospitality and the Food and Drink Federation, among others, sent a joint letter to Peter Kyle warning him that an inflexible guaranteed hours regime could mean an end to flexible roles altogether. They urged the Government to raise the reference period from 12 weeks to at least six months and to set the low-hours contract to eight hours. Will the Minister commit to listening to business and making these changes?

We committed during the passage of the Employment Rights Act to consult trade unions, businesses and all those affected as we take forward the other measures there, including the measures to which the noble Lord refers. At the appropriate time, we will put that out to consultation, which will be open to everyone to respond to.

On hospitality and retail, it is recognised that this is a very important first step, and that is one reason why we are expanding opportunities through the new foundation apprenticeships in hospitality and retail, launching a level 2 administrative assistance apprenticeship from August and introducing the £2,000 hiring payment for employers that recruit young apprentices.