Government Commits £900m to Expand Youth Guarantee and Reshape Apprenticeships

The government has announced a £900m expansion of its Youth Guarantee scheme, alongside changes to apprenticeships, in what ministers say is an effort to create more opportunities for young people entering work. The package forms part of a wider £1bn youth employment plan, which the government says could help unlock 200,000 jobs and apprenticeships.

Under the plans, the Jobs Guarantee will be extended from 18 to 21-year-olds to 18 to 24-year-olds. The government says this will create more than 35,000 additional placements and support more than 90,000 young people over the next three years. A new Youth Jobs Grant will also give employers £3,000 for each eligible 18 to 24-year-old they hire who has been claiming Universal Credit and searching for work for six months. Ministers say that measure is expected to support 60,000 young people.

The apprenticeship system is also being reshaped. Small and medium-sized businesses will receive £2,000 for each new apprentice they take on aged 16 to 24, while foundation apprenticeships are due to expand into hospitality and retail from April 2026. The government says the broader reforms are intended to create 50,000 more apprenticeships.

The announcement follows commitments set out in Budget 2025, which allocated more than £1.5bn across the spending review period for the Youth Guarantee and the Growth and Skills Levy. The government says the latest measures take total investment in the Youth Guarantee and additional Growth and Skills Levy funding to £2.5bn over the next three years.

For employers, the changes mean more direct financial support for taking on younger workers, particularly in sectors with persistent recruitment pressures. For young people, the government says the aim is to widen access to paid work, training and apprenticeship routes at a time when the transition from education into employment remains difficult for many.