Businesses, including bakeries, are to be given a £3k grant for each young person they hire as part of a new government scheme to tackle unemployment.
Recruits need to be aged 18 to 24 and looking for work for at least six months whilst on benefits. The new Youth Jobs Grant is expected to support 60,000 individuals over three years, while an expansion of the Jobs Guarantee to a wider age group – from 18-21 to 18-24 – will create more than 35,000 extra subsidised jobs.
The government said it is also making its “biggest transformation of apprenticeships in a decade” to help address the 40% drop in apprenticeship starts among young people over the past ten years. Almost one million young Brits are currently neither earning nor learning, representing a rise of 248,000 between 2021 and 2024.
There’s now an Apprenticeship Incentive of £2k for each new employee aged 16 to 24 taken on by an SME, such as a craft or artisan bakery. This forms part of wider reforms designed to drive progress to the government’s target of creating 50,000 more apprenticeships.
Further reforms to the Growth and Skills Levy are planned to help prioritise young apprentices, secure value for money, and give school and college leavers more opportunities than ever to build careers in cutting edge industries.
With 7.3 million people in the UK currently lacking the essential digital skills needed for work, the government has also launched a new AI and automation practitioner apprenticeship to help workers and businesses harness artificial intelligence. The first cohort for an 18-month Level 4 apprenticeship will be getting underway this month, with participants trained to identify where AI can save time, cut costs, integrate digital systems and use it safely and responsibly.
“These measures will give life-changing opportunities to young people and significantly reverse the increase we inherited in those not in education, employment or training,” said work and pensions secretary Pat McFadden. “We are focusing funding where it’s needed most and giving employers the flexibility and support they’ve asked for.”
Last month, Jacksons Bakery and Samworth Brothers unveiled new programmes and expanded intakes opportunities, while East Sussex-based Plumpton College became the first UK provider of Level 3 Lead Baker Apprenticeships in July 2025.
Trade body reacts
The government’s ambition to help more young people into work, training, and apprenticeships was welcomed by the Craft Bakers Association (CBA). However, it warned that recent policy decisions – particularly the 8.5% increase in the National Living Wage for 18- to 20-year-olds coming into effect in April – have made it increasingly difficult for small bakery businesses to continue offering these entry-level opportunities.
“Our industry has long provided vital first job opportunities for young people, with many bakers and bakery managers beginning their careers straight from school or college,” commented CBA chief executive Karen Dear. “While bakery businesses absolutely believe in paying fair wages and investing in their teams, the pace and scale of mandatory cost increases, including wage rises, National Insurance changes and other regulatory costs are putting severe pressure on small independent businesses.
“As a result, some bakeries are unfortunately being forced to reduce recruitment, cut hours or delay hiring younger workers. This is the opposite of what the industry wants to see,” expressed Dear.
The trade body chief asserted that if the government is serious about increasing youth employment, its policies must ensure that taking on a young person remains affordable for small businesses. “Incentives such as the proposed Youth Jobs Grant and apprenticeship support are welcome, but they must be accompanied by a broader understanding of the cost pressures facing SMEs,” she said.
“Independent bakeries want to continue offering apprenticeships, first jobs and career pathways for young people. With the right balance of support and realistic employment costs, our sector can play an even greater role in helping the next generation enter the workforce,” added Dear.
Fellow trade body Scottish Bakers, meanwhile, noted that apprenticeships are devolved and operate differently in Scotland and so the new incentives are unlikely to benefit its members.
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