There’s a new Employment Rights Bill from the Government – but will it help marginalised young people to find good work?

A week on from the launch of the Government’s Employment Rights Bill, Youth Futures’ Director of Impact and Evidence, Chris Goulden, examines what it might mean for the job prospects of marginalised young people.

As the What Works Centre for youth employment in England, we want to improve policy and practice for young workers by generating and using more and better evidence. The Bill is a welcome chance to review and improve the legislative framework affecting the nature, scale, and location of jobs in our economy that provide vital opportunities for young people. We’ve been impressed with how the Department for Business and Trade have been seeking engagement with us and other expert organisations on the proposals in the Bill. 

Improving job quality 

An area of major reform likely to affect young people is statutory changes to improve job quality. That includes raising minimum wage rates for young people to that of older workers, effectively removing historic age differences and, in the process, taking most workers to the National Living Wage (albeit not the – higher – Real Living Wage). Alongside these pay changes, greater rights from day one of a new job (rather than day 730) and a ‘ban’ on zero-hours contracts (ZHC) will effectively be weighted towards young people (with 1 in 8 of them on a ZHC, compared to 1 in 50 for older workers). 

Taking a measured approach 

There is a risk nonetheless that such significant reform across all three areas (minimum wages, day one rights, ZHC), alongside other changes, could negatively impact young people and increase our already high rates of youth unemployment and inactivity. The labour market needs reform, but managing these risks relies on improvements in other areas to help develop young people’s skills, so they can take advantage of better opportunities. 

That’s why we’re pleased the Government is committed to a measured approach to introduction and continued consultation with employers, unions and labour market experts. It will be vital that they, alongside the Low Pay Commission, pay close attention to any warning signs in the youth labour market as changes are rolled out.  

Getting the balance right 

What does this mean for the specific impact of raising minimum wage rates for young people, for example? We have worked with RAND Europe on a report, which will soon be available on the Youth Futures’ website, to look at the international evidence base on the effects of changes to youth minimum wages. It assesses impacts on supply and demand in the labour market and the education / training system, as well as on the public purse. 

This evidence indicates that increasing youth minimum wages doesn’t seem to lure young people out of education but there is some extra attraction into the labour market from those out of work, especially among the lower skilled. There are some negative impacts on labour demand at lower age ranges, but overall positive effects on incomes and inequality. Most importantly, the review found that governments can reduce any potential negative impacts through effective job support and skills development. 

That’s why join-up across the policy agenda is vital. Government will need to ensure initiatives like the Youth Guarantee, and other skills and welfare reforms go hand-in-hand with these proposed labour market changes for young people to truly benefit. 

Embedding youth voice  

To ensure helping marginalised young people remains front of mind in any labour market reform, we will also continue to ensure their voices are heard in policy discussions. Any changes to young people’s working lives should not just be informed by evidence but also by their direct experiences. 

That’s why we have been working with Workwhile to carry out a project to define young people’s view of what is ‘good work’. This will launch at our event next Tuesday 22 October, and inform part of a wider project, funded through an Economic and Social Research Council Policy Fellowship, on the data needed to define good jobs, and how and where they can be created. 

This is especially important for marginalised groups who are most likely to be affected by these areas of reform – and are more likely to earn below the Real Living Wage and work in sectors where job insecurity is common.  

Although most of the reforms will not come into play until Autumn 2026, the next phase of consultation will be important to help ensure improved employment rights for young people. Youth Futures’ mission is to provide evidence and insight, working with Government and young people, to ensure those who are marginalised can achieve good work.