Retail chiefs press PM on youth jobs

The British Retail Consortium says more than 80 retail chief executives have written to the Prime Minister calling for urgent action on youth unemployment, warning that government policy is making it harder for retailers to hire young people.

The letter urges ministers to reduce the cost and risk of employing young workers as the sector faces higher National Insurance contributions, above-inflation wage increases, and employment rights changes. Retail leaders said the government must act to “turn around the fortunes of young people everywhere”.

The intervention follows Alan Milburn’s interim report into young people and work, which warned that 1.25 million under-25s could become unemployed over the next five years. The BRC said retail remains the UK’s most important entry point into employment, accounting for almost a quarter of youth employment.

Retail has historically offered flexible, local, seasonal, and first-job roles at scale. Those jobs often provide early experience of paid work, customer service, team discipline, rota management, and progression into supervisory or management positions.

The BRC said 400,000 retail jobs have already been lost over the past decade, reducing the number of routes available for young people to enter the labour market. The letter argues that rising employment costs and regulatory pressure risk weakening one of the economy’s largest employment pipelines while youth inactivity and unemployment are already under political scrutiny.

Retailers are not arguing from a position of easy trading. Although recent warmer weather has lifted some sales categories, the sector continues to face tight margins, fragile consumer demand, wage cost pressure, business rates concerns, crime and shrinkage costs, logistics inflation, and the ongoing shift between physical and digital channels.

The employment argument sits within that wider commercial pressure. First-job roles tend to be most exposed when employers are forced to manage labour costs tightly. Companies can reduce hours, delay recruitment, automate tasks, consolidate store operations, or rely more heavily on experienced staff rather than take on young workers who require supervision and training.

The government’s employment policy agenda is also gathering pace. Ministers are consulting on changes to zero hours arrangements, while separate proposals would strengthen rights for unpaid carers and parents of seriously ill children. Each measure has a policy rationale, but the combined effect will shape hiring decisions.

Retail leaders are focused on the cost of creating roles in a sector where margins are often thin and staffing needs can shift quickly. A first-job worker may need training, closer supervision, and more flexible scheduling before becoming fully productive. When wage, tax, and compliance costs rise together, some employers may decide that the risk of hiring inexperienced workers is too high.

Youth employment is also a productivity issue. Early work experience helps build basic workplace capability, including punctuality, communication, problem solving, customer interaction, and confidence. If fewer young people enter work through retail, the pressure moves elsewhere: colleges, employment support schemes, apprenticeships, hospitality, care, logistics, and public sector programmes.

The BRC’s letter places business leadership directly into the policy debate. It asks ministers to consider not only the headline ambition of stronger employment rights and higher minimum pay, but the way costs, incentives, and risk affect the creation of first jobs.

Any response will need to balance worker protection with entry-level hiring capacity. Reducing youth unemployment depends on employers being willing to create roles, invest in training, and manage inexperienced staff. If policy raises the fixed cost of hiring without support for training or progression, fewer first-step jobs may be created.

Retail’s size means the outcome will be felt beyond the sector. Decisions made by supermarkets, fashion chains, convenience retailers, garden centres, and digital retailers influence local labour markets across the UK. The letter gives ministers a direct warning from employers that youth employment cannot be separated from the cost base of the industries most likely to hire young people first.