Government Announces Measures to Deliver Youth Guarantee

Over the next three years, the Government has announced a ‘Youth Guarantee’ committed to ensuring that every young person aged 16 to 24 has the support and opportunities to get into work or education. It will invest £2.5 billion to help young people build skills, gain experience and progress into employment or further learning. This investment sets out to support almost one million young people and unlock up to 500,000 jobs, training and learning opportunities.

For employers, the Youth Guarantee promises access to fully funded training, financial incentives and a pipeline of young talent. This support is designed to help fill skills gaps today while investing in the future workforce. Access could include:

• £3,000 Youth Jobs Grant for every person aged 16 to 24 businesses hire across Great Britain who has been looking for work for six months or more, available from June 2026
• £2,000 Apprenticeship Incentive for SMEs in England taking on a new apprentice aged 16 to 24, available from October 2026
• Fully funded apprenticeship training for SMEs employing eligible 16 to 24-year-olds, from August 2026
• Subsidised job placements through the expanded Jobs Guarantee, now open to candidates aged 18 to 24
• National Insurance contribution exemptions for employees under 21 and apprentices under 25 (on wages up to £50,270)

To sign up to be part of the Youth Guarantee, companies should visit www.business.gov.uk/recruit.

Shaun Wadsworth, CFA Training Manager, says: ‘The CFA welcomes the Government’s recently announced measures to provide additional financial incentives for employers hiring apprentices, particularly at a time when businesses continue to face cost pressures and skills shortages.

‘A consistent message from our members, many of whom are small and medium-sized enterprises (SMEs) is the need for more targeted financial support to help them invest in early talent. SMEs play a critical role in apprenticeship delivery yet often operate with tighter margins and less capacity to absorb upfront training costs. The introduction of enhanced incentive payments for employers recruiting young people, particularly those aged 16–24 and individuals currently out of work, is therefore a positive and welcome step. These measures have the potential to reduce barriers to entry for SMEs and encourage greater participation in apprenticeship programmes.

‘We are also encouraged to see these incentives aligned with wider initiatives led by the Department for Work and Pensions (DWP), including the Youth Guarantee, Youth Hubs and Sector-Based Work Academy Programmes (SWAP). Greater alignment across these programmes is essential to ensure employers can easily navigate the system and access the support available. The CFA continues to work closely with DWP to raise awareness of these initiatives among our members and to ensure that employer feedback, particularly from SMEs is reflected in future policy development.

‘To maximise impact, we would encourage the Government to ensure that funding remains accessible, clearly communicated, and responsive to the needs of smaller employers, who are vital to delivering sustainable apprenticeship growth across the UK.’

www.cfa.org.uk