There has been increased debate over youth participation in education and employment, and the scale of the challenge is undeniable. Nearly one million young people are currently NEET, continuing an upward trend over the last 5 years. The reality is that the status quo is not delivering for too many young people. The current system risks writing people off too early, rather than helping them understand what support might help them move towards work when they are ready.

Against that backdrop, the Government has signalled further reforms focused on young people receiving health-related benefits. The forthcoming Milburn Review is expected to consider requiring young people receiving health-related benefits to engage with employment and skills support.

Making benefit receipt conditional on certain activities has long been part of the welfare state. Conditionality, making benefit receipt conditional on certain activities, already applies to many working-age claimants and reflects a balance between rights and responsibilities. Successive governments have taken different approaches, but the underlying principle has remained broadly consistent. The debate is about where the boundaries should be drawn and what safeguards should apply.

From Passive Support to Active Engagement

In The Benefit Trap, we argued for mandatory Work Support Conversations for people claiming health-related out-of-work benefits. These conversations would provide a structured conversation about a person’s ambitions, circumstances and the support available to them. Too often people are assessed as having limited capability for work and then receive little further engagement, despite research showing that many people receiving health-related benefits would like to work in the future, given the right support and opportunities.

There is a strong case for expecting people to take part in a conversation. Requiring participation in training, employment support or other activities is a much bigger step, particularly for groups that have not previously been subject to work-related requirements. Government should start with conversations, learn from the evidence, and proceed cautiously. And of course, we will still need exemptions for young people with severe health conditions.

International and UK research indicates that while benefit conditionality and sanctions can increase short-term exits from benefits and slightly accelerate job entry, but longer-term outcomes for sustained employment, job quality, and earnings are generally negative or minimal. If the goal is to improve outcomes for young people, the Government must be clear about who is expected to engage, what support will be available, who may be adversely affected, and how any risks will be managed.

Key Considerations for Government

As policy develops, there are three important questions that need answering.

1. What additional support will be on offer?

Any new expectation to engage should be matched by guaranteed and tailored support. The extension of the Jobs Guarantee, announced earlier this year and funded through the recent budget, is a significant step but it will not be suitable for everyone.

DWP and its partners must ensure there is sufficient capacity, quality and availability of support. Young people with health conditions often face multiple and interconnected barriers. Employment support may need to sit alongside help with confidence, wellbeing, skills, housing or wider life challenges. In many areas, support outside Jobcentre Plus has been reduced following the loss of previous funding streams.

The Government will need to set out how these different elements fit together, with Mayoral Strategic Authorities and local partners playing a critical role in delivering support.

2. How will young people be engaged positively?

The objective should be to encourage engagement, not simply enforce compliance. Young people seeking work are already sanctioned at higher rates than many other claimant groups, and there is a risk that conditionality is applied rigidly, leading to more punitive actions. If conditionality is expanded, sanctions should be a genuine last resort, with the primary focus on positively engaging young people and building participation through relationships and opportunity.

Alongside any changes to conditionality, the Government should explore new ways of building positive engagement. This could include more personalised outreach, flexible delivery models, and making support available through routes that young people already trust and engage with. There may also be opportunities to connect employment support more effectively with young people receiving Personal Independence Payment (PIP), many of whom may benefit from additional help to access or progress in work.

Ultimately, reforms to health-related benefits should form part of a broader strategy to increase youth participation, built around encouragement, relationships and opportunity rather than compliance alone.

3. What about young people outside the benefits system?

A substantial proportion of NEET young people are not claiming out-of-work benefits at all. Many move in and out of NEET status relatively quickly, but a significant proportion remain disconnected from employment, education and training for longer periods without accessing formal support.

This group is often less visible to support services and may face equally significant barriers to employment, education or training. Focusing only on benefit claimants risks creating different levels of support and engagement for young people facing similar challenges.

Government should consider how it reaches reach these off-the-grid young people, outside both employment and the benefit system, as part of a broader participation strategy.

Proceeding with caution

Significant reform is needed to move away from a system where too many young people are categorised, parked and left without meaningful routes into employment or education.

To succeed, any reforms must be designed with, not just for, the young people they affect. The Government should work closely with young people, disabled people and local areas to ensure changes are practical, fair and effective. At the same time, it must provide confidence that those who cannot work will receive the financial support they need.

Requiring engagement in a conversation is a positive step towards a more proactive system. But it will only succeed if it is accompanied by investment in effective services, strong local partnerships and a labour market capable of offering real opportunities. Benefit reform alone cannot solve the challenge of youth inactivity. Moving beyond a conversation to wider work-related requirements should be approached with caution. If the Government chooses that path, it should proceed carefully, strengthen the support available, listen to those affected, and ensure reforms are judged on whether they genuinely improve outcomes for young people. Ultimately, the success of reform will depend not just on what is expected of young people, but on the support and opportunities available to them.

By Elizabeth Gerard, Deputy Director at the Learning and Work Institute