Plan to Make Firms Pay More to Train Older Workers Than Youth 2026

The UK government is planning to make firms pay more to train older workers than youth apprentices in England, as part of a radical overhaul of apprenticeship funding to tackle the youth jobs crisis. Under proposals being drawn up by ministers, employers would face a 25% higher cost for training a worker over the age of 25 compared to a younger apprentice, in a bid to encourage businesses to invest in young people.

Why the Government Is Targeting Older Worker Training

The move comes amid a 40% drop in youth apprenticeship starts over the past decade and a surge in young people not in education, employment or training (NEET) to almost 1 million. The government hopes that by making older worker training more expensive, employers will redirect their apprenticeship levy funds toward younger candidates, helping to reverse the decline in youth opportunities.

Ministers are responding to Alan Milburn's review into youth unemployment, which is expected to highlight the need to boost access to apprenticeships for young people. The final report has been delayed until after the budget, but Milburn has already signalled that apprenticeships are critical for fixing the first rungs of the career ladder.

How the New Funding Model Would Work

Currently, employers in England can use their apprenticeship levy funds to train workers of any age. The proposed changes would introduce a tiered pricing structure, where the cost of training an older worker (over 25) would be 25% higher than that of a youth apprentice (under 25). This differential is designed to incentivise businesses to prioritise younger candidates.

The government is also considering other measures to support youth employment, including sweeping changes to technical education and apprenticeships, as championed by Andy Burnham. The chancellor, John Healey, is expected to include these measures in his upcoming tax and spending statement. The background to this story is set out in Over-50s Unemployment Crisis Demands Jobs for Older Workers. A related thread runs through Pre-Apprenticeship Scheme to Close Youth Unemployment Gap. Earlier coverage in Apprenticeship Experience: UK Employers Share Insights shows how the argument developed.

Potential Impact on Businesses and Older Workers

While the plan aims to boost youth employment, it could have significant implications for businesses and older workers. Companies may be discouraged from investing in upskilling their older workforce, potentially widening the skills gap and reducing opportunities for career progression among experienced employees. A closer look at the same subject appears in Older Workers Struggle to Find Work: Age Discrimination in Hiring. Anyone following the wider picture can start with Job Anxiety Soars for Older Workers: The Hidden Crisis. The same theme surfaces in Youth Jobs Crisis: Dublin's Lessons for UK Apprenticeships, which takes a different angle.

Critics argue that the policy could be seen as ageist and may lead to older workers being overlooked for training opportunities. However, supporters believe that the current system unfairly disadvantages young people and that the differential is necessary to rebalance the apprenticeship landscape. Context on how this played out before sits in Making Apprenticeships Accessible: Fixing a Broken System. A companion piece, Apprenticeship Experience in England: Share Your Story, approaches the same subject from another angle.

Key Takeaways

• 25% higher training cost for workers over 25 compared to youth apprentices.
• Aims to reverse 40% drop in youth apprenticeship starts over the past decade.
• Part of government response to Alan Milburn's review into youth unemployment.
• Could impact older workers' access to training and career development.
• Chancellor John Healey expected to announce measures in upcoming budget.

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