According to Employment Hero’s data, the number of young workers in employment is declining fastest.
The company analyzed 105,000 employees from more than 1,500 small- and medium-sized companies and found that overall employment fell by 0.4% in February. The most dramatic decline in employment was among younger workers aged 16-24, with a 1.8% drop.
From April, the new national minimum wage of PS12.25 an hour will be applied to all workers older than 21. Workers aged 21-23 used to be paid at a lower rate. This band has now been abolished.
This comes shortly after the Office for National Statistics revealed that by December 2024 the number of youths not in education or employment (Neet) would rise to nearly 1 million .
Employment Hero found that the employment of small and medium-sized businesses has been declining by 0.3% per month since October. This is a result of caution following an announcement from the government to increase employer contributions for national insurance starting in April.
The salary threshold to pay employer NI contributions was lowered from 9,100 PS to 5,000 PS. This will disproportionately impact younger, part-time, and lower paid staff.
“Younger workers often need more training and support.” Many SMEs won’t replace them as they cannot afford to take on the extra work.
If this trend continues, it could mean a more difficult job market in the months to come, especially for young workers who are trying to climb the career ladder.
The Recruitment and Employment Confederation announced earlier this month that recruitment activity had declined but at a softer rate during February. However, overall demand for personnel remained low.
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