After years of policy churn, rising costs and new rules arriving faster than anyone can absorb them, many firms have run out of energy to engage, says Georgiana Bristol
There is a strange quiet in the business community this week. Not the calm of confidence, but the hush before something hits. Normally, in the run-up to a Budget, you would hear business leaders making their case, lobbying loudly, trying to shape what is coming. This year, that noise has disappeared.
After years of policy churn, rising costs and new rules arriving faster than anyone can absorb them, many firms have run out of energy to engage. They keep their heads down. They stop hiring. They focus on surviving whatever comes next. For thousands of small and mid-sized businesses, this defensive posture is now standard. Teams are stripped back. Managers are stretched thin. The idea of taking on someone who needs more time or support, a young person who 10 years ago would have been given a shot, feels out of reach. Not because they do not care, but because the margin for error has disappeared.
And businesses can see the bigger problem forming behind this. While they have grown quiet, a far more worrying silence has deepened: young people dropping out of education, work and training, and disappearing from view. New statistics last week show that there are nearly a million young people in this group. The lack of furore over this news shows that we have somehow drifted into accepting that huge numbers of young people are out of the labour market altogether, their talent going nowhere.
A charity leader said something recently that stayed with me. Some of these young people are completely alone. If they can get them to leave the house for training, that is a win. This is the reality behind our employment figures. It should make us stop and re-examine what we think the system is there to do.
When business leaders say they cannot take a risky hire, it is because all the scaffolding around early-stage employment has eroded
Employers cannot fix this by themselves. They do not have the bandwidth. When they say they cannot take a risky hire, it is because all the scaffolding around early-stage employment has eroded. Apprenticeships are too rigid, training pathways too thin, support services spread too far. Businesses are being asked to take on the hardest challenges with the least capacity.
And they simply cannot, not while carrying high employment costs, rising wage floors and the constant pressure of regulatory change. Many are fighting to stay open, let alone take risks on young people the system has already failed.
There is an alternative
But this does not have to be the story. There are practical steps the Chancellor could take now that would genuinely shift the dial. A targeted National Insurance holiday for firms hiring people coming out of long-term inactivity would reduce the upfront cost of giving someone a start, as campaigned for by the Jobs Foundation and the Good Growth Foundation. And as the Jobs Foundation has advocated for alongside Christopher Nieper OBE, the Centre for Social Justice, and 125 top business leaders – a skills tax credit for employers who train and hire young people who are currently not in employment, education or training would show that the government understands the real barriers and is willing to share the load.
These are not grand schemes. They are simple tools that would make hesitant employers more willing to open their doors again.
That is why this Budget matters. It is more than a line-by-line fiscal exercise. It is a chance to confront what is happening to a generation of young people, and to the businesses who want to employ them but feel unable to. A decent society does not write off its young. It does not pretend long-term dependency is inevitable. And it should not accept a labour market in which promising school-leavers drift into their twenties without direction or confidence.
The Chancellor has a choice. She can deliver another technical Budget focused on balancing sums set by the OBR, or she can acknowledge the scale of the challenge facing our young people and set out a plan for genuine renewal.
Right now, businesses are quietly saying the same thing young people are saying: we need the conditions to succeed. Not slogans or pressure, but a framework that allows them to take a chance on each other again.
We have already lost too many young people to inactivity and isolation. Losing more through drift and inaction would be a failure we cannot afford.
The Budget will not fix everything. But it should at least show that someone is listening.
Georgiana Bristol is CEO of the Jobs Foundation