In the early 2000s, Britain had as many as 10 young workers for every person over-65 with a job. Today there are just two, as older employees hang on for longer and first jobs are harder to come by.
The number of Britons aged 65 and over in work topped 1.7 million earlier this year, according to the latest Office for National Statistics figures. Longer life expec
tancy and better health are delaying retirement, while cost-of-living pressures have also convinced people from the baby-boomer generation to stay on the payroll a little longer.
Employment rates for the group — many of whom are beyond state pension age — are at a record high.
In an ideal world, this would create a workforce in which multiple generations freely exchange skills and experience. However, the UK is suffering from what the Bank of England calls a “low hire, low fire” labor market, keeping young people stuck on the outside.
Youth unemployment is close to its highest rate in more than a decade, officials figures show, while entry-level jobs have plunged. Young people are signing up for emergency degrees to delay their entry into an increasingly unwelcoming labor market.
Almost a million 16-24 year-olds are out of work or education entirely, a NEET crisis as it’s known i
n the UK. The country’s Labour government is trying to understand the problem but has been accused of driving up the cost of hiring young workers.
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Weak growth and a volatile global backdrop are making employers wary of hiring. And with fewer jobs opening up, workers postponing retirement can have “a knock-on effect” on how many jobs are created for young people, according to Ben Harrison, director of the Work Foundation at Lancaster University.
The youth unemployment crisis is a priority for Prime Minister Andy Burnham, who has expanded a program to subsidize minimum-wage jobs for young people, and announced plans to overhaul vocational paths into work.
Some of the left of the party want the government to go further to address what they see as generation unfairness. A recent report from the Institute for Public Policy Research, a Labour-leaning think tank, called on the government to direct taxes away from young workers and toward pensioners, by targeting property and other wealth.
Pandemic
While Britain’s overall employment rate has held relatively steady, only half of 16-24 year-olds are in work, down more than four points since 2022 — a drop similar in scale to the pandemic and the 2008 financial crisis, according to the Institute for Fiscal Studies.
During the pandemic, the UK seemed to be facing a very different problem as a wave of the baby-boomer generation decided to retire early. Cost-of-living pressures have drawn some back in, however. Roughly one in six retirees have either returned to work or were considering it, according to a 2026 Standard Life survey.
“There might also be an element of older people topping up their income and working part-time in lower-skilled or lower-paid sectors, in jobs that might’ve gone to young people in the past,” said Bruna Skarica, chief UK economist at Morgan Stanley.
