Young, Broke and Hopeful: Wales Sets up £2.5bn Scheme To Get 56,000 Unemployed Welsh Youth off the Dole

Wales is rolling out its share of a £2.5 billion UK-wide scheme aimed at helping more than 56,000 young people who are not in education, employment or training move into work, with the first placements already under way in south Wales for 18 to 24-year-olds who have spent at least 18 months on Universal Credit while looking for a job.

The launch comes as youth unemployment in Wales has risen sharply. Between 2024 and 2025, unemployment among 16 to 24-year-olds increased by 9.5 percentage points, compared with a rise of 1.1 points in Scotland and 1.9 points across the UK.

Wales Youth Unemployment Rises Above UK Average

Wales now has 32,800 young people actively out of work. Its youth unemployment rate is 16.3 per cent, compared with 12.6 per cent in Scotland and 13.5 per cent across the UK.

The figures have raised concerns that more young people could become stuck outside the labour market for years. Analysts have compared the risk with long-running youth unemployment problems in countries including France and Italy.

Jobs Guarantee Offers Six Months of Paid Work

The Government's main answer is the Jobs Guarantee. It will pay for up to 25 hours of work a week for six months, with eligible young people earning at least the National Minimum Wage and receiving employer pension contributions.

Around 3,500 young people in Wales are expected to take part over the next three years. More than 90,000 placements are planned across the UK.

The first placements in Wales are operating in Cardiff, Newport, Merthyr Tydfil, Bridgend, Swansea, Caerphilly and Rhondda Cynon Taf. Employers in construction, retail and hospitality are among those taking part.

Employers can receive up to £250 per participant to cover costs such as uniforms, safety equipment and workplace adjustments.

£20m Fund Gives Wales More Control

The Government is also handing more control over employment support to Wales. Funding for services outside Jobcentre Plus is being devolved to the Welsh Government.

The move will allow local programmes to be shaped around the needs of each community rather than following the same approach across the UK.

An initial £20 million has been given to Economic Inactivity Trailblazers in Blaenau Gwent, Denbighshire and Neath Port Talbot. The schemes will work with people who are out of work and help them find a route back into jobs, with local providers deciding what support will work best in their communities.

Youth Hubs Bring Support Under One Roof

Twenty Youth Hubs are also being established across Wales. The hubs will bring together Jobcentre Plus, councils and training providers. Young people will be able to access careers advice, skills training, mental health support and housing guidance through the same service.

The aim is to take on the problems that can make finding a job difficult, from housing issues to gaps in skills and training.

Opposition Warns of Cuts to Apprenticeships

Opposition politicians argue the Government is tackling only part of the problem. The Welsh Liberal Democrats have pointed to higher employer National Insurance contributions and the rising minimum wage, which they say have increased the cost of taking on staff.

Opposition figures cited local businesses that claim the extra costs have led them to cut recruitment and, in some cases, let younger workers go.

The party has also called for the Welsh Government to restore the 25 per cent cut to the apprenticeship budget. It says paid placements alone will not be enough, and that young people also need stronger long-term investment in skills and apprenticeships.

Critics also point to high housing costs and student debt as barriers for young people trying to build a life in Wales. The lack of opportunities has also contributed to a steady flow of young people leaving Wales for jobs elsewhere in the UK.