More than 80 retail bosses have written to Prime Minister Sir Keir Starmer warning that the “ladder of opportunity for young people is wobbling” and urging immediate action on youth unemployment.
The letter, coordinated by the British Retail Consortium (BRC), was sent Wednesday morning and signed by the chiefs of major retailers including Tesco, Sainsbury’s, John Lewis, Amazon UK, Asda, Boots, Currys, Greggs, Morrisons and Primark.
Nearly 3 million people work in UK retail, but the BRC says more than 400,000 industry jobs have disappeared over the past decade. The youth unemployment rate has hit an 11-year high, while job vacancies across the labour market have fallen to a five-year low.
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“Retail has always been where any young person can start with few qualifications, limited experience and build a lasting career either in the industry or outside with the skills they obtain,” the industry leaders told the Prime Minister.
The letter notes many of the signatories began their own careers on the shop floor. “This matters to us, particularly as many of us started on the shop floor, and it is central to our purpose and to how our businesses grow and compete.”
Cost pressures and employment law changes
The retail chiefs explicitly warned that new Employment Rights Act changes are making workforce management “more complicated when we need it to be simpler.” They said it’s “more expensive than ever to bring in young talent.”
“This is putting pressure on employers’ ability to drive social mobility,” the letter states. The BRC urged the government against discouraging “entry-level recruitment and progression” and instead called for more support for employment and career development.
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In recent weeks, retailers have increased pressure on Labour to reverse its hike to national insurance contributions and abandon plans to scrap age-based wage brackets. Some criticism has also targeted minimum wage increases, sparking debate over the role of the Low Pay Commission — the independent body that recommends pay rises for low-income workers.
Former prime minister Rishi Sunak had said he would abolish the body and let ministers set pay directly. Welfare secretary Pat McFadden told City AM that would be a “mistake” due to concerns over lobbying.
A generation at risk
The retail letter arrives just two weeks after former health secretary Alan Milburn published a report on young people not in education, employment or training. He warned there could be 1.25 million 16-to-24-year-olds out of work by the end of the decade.
Milburn is set to release policy recommendations later this year. He has suggested the welfare budget distorts work incentives and appeared to criticize employers for using video interviews and AI in recruitment processes.
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Helen Dickinson, the BRC’s chief executive, said the message from retail is direct: “If government is serious about tackling youth unemployment, it cannot keep making it more expensive to create jobs.” She proposed a joint retail-government taskforce to “strengthen routes into employment, remove barriers to hiring and help more young people take that key first step into the world of work.”
Rob Swain, UK general manager at KFC, said retail and hospitality are “where young people build confidence, develop lifelong skills and discover their potential.” He added the company is “keen to work with the government and the BRC to bring more young people into our restaurants.”
A government spokesperson said Labour is addressing the challenges in the Milburn report. They pointed to a £2.5 billion youth employment support package that aims to create 50,000 more opportunities for young people. Starting this month, the government is rolling out £3,000 payments covering six months of wages for those out of work long-term, and cutting hiring costs for under-21s and apprentices.
