If you’ve noticed that employing people is getting more expensive, you’re not imagining it.
The cost of having a team has gone up across the board:
- NI increases from the budget
- Day-1 SSP under the Employment Rights Act
- Expanded leave entitlements
- Plus a growing list of compliance obligations
So, when the government offers you money to take someone on, it’s worth paying attention.
What’s actually on offer
The Youth Jobs Grant gives you £3,000 towards hiring an unemployed 18 to 24 year old who has been out of work for 6 months or more. It’s part of a £1bn expansion of the Youth Guarantee scheme and the government estimates that it will help around 60,000 young people into work over 3 years.
There’s also a separate £2,000 apprenticeship incentive for small employers taking on apprentices aged 16 to 24.
Both are designed to lower the barrier for businesses that want to bring in younger workers but have been put off by cost.
Why this is landing at the right time
Youth unemployment is near a 5-year high. As of late 2025, around 957,000 people aged 16 to 24 were not in education, employment or training.
At the same time, hiring experienced workers keeps getting pricier. Salaries are up. Employer costs are up. And the compliance burden is only growing.
For small businesses feeling the squeeze, a grant like this creates a genuine opportunity to bring in resource at a lower upfront cost.
The apprenticeship angle is worth a closer look
Apprenticeship take-up has dropped significantly in recent years. Schools and colleges are now actively warning students that places are harder to find than they used to be.
That creates something interesting for employers. There are motivated young people out there looking for opportunities and fewer businesses competing to offer them.
The £2,000 incentive makes the numbers more realistic for small businesses that previously couldn’t justify the investment. If you’ve ever thought about growing your own talent rather than competing for experienced hires, this is a good moment to revisit that.
Don’t skip the setup
Here’s the bit that matters just as much as the money.
A £3,000 grant helps with the cost of hiring. It doesn’t help if that person leaves after 2 months because nobody planned their first few weeks properly.
With 6-month unfair dismissal rights coming into force from January 2027, every hire needs to be set up for success from day 1. That includes younger and less experienced workers, who often need more structure, clearer expectations and regular check-ins to get up to speed.
Before you apply, do you have the basics in place? Including:
- a proper induction process
- clear expectations for the first few months
- someone available to manage and support the new hire
- a documented probation process that you actually follow
The grant reduces the financial risk. Good onboarding reduces every other kind.
Something worth thinking about longer term
If the cost of hiring experienced workers keeps climbing, the way you build your team may need to change.
Apprenticeships, graduate schemes, adult apprenticeships and supported hiring programmes are all routes that more small businesses are starting to explore. They’re becoming more cost-effective than competing for the same pool of experienced candidates as everyone else.
This article focuses on what’s available right now. But the bigger question of how you build your talent pipeline when hiring costs keep rising is one worth thinking about seriously.
Where an HR consultant can support you
If you want to take advantage of the grant or the apprenticeship incentive but aren’t sure whether your onboarding, probation and management processes are ready, an HR consultant can help you to get that right before the new hire starts.
We can also help you to think through what kind of role would work best, how to structure the early months and how to make sure that you’re meeting your obligations under the new employment rules.
Get in touch we’ll be more than happy to talk you through it.