Cost of employing an 18-year-old rises 40% in a decade

Hiring an 18-year-old costs 40% more than it did a decade ago amid warnings that minimum wage increases are fuelling the youth worklessness crisis.

The Telegraph reports that The Tony Blair Institute has urged Labour to offer more tax breaks for businesses that employ younger staff to help some of the million people not in employment, education or training (NEET) find work. A report from the former prime minister’s think tank said the real-term cost of employing 18-year-olds had soared even as economic growth has stalled. The think tank called for new business tax breaks that remove a “cliff edge” of extra costs facing employers who hire an 18-year-old, such as through phasing in employer national insurance contributions throughout workers’ early 20s.

Beyond the direct cost implications for employers, there is also a broader conversation about the role entry-level jobs play in helping young people enter the workforce. For many, hospitality provides that crucial first step into employment, offering opportunities to build confidence, develop transferable skills, gain financial independence and learn the responsibilities that come with work. These early experiences can shape future careers, helping young people develop communication, teamwork and problem-solving skills that benefit them throughout their working lives.

As employment costs continue to rise, there is a concern that businesses may have fewer opportunities to offer these entry-level roles. Ensuring employers can continue to invest in young talent is not only important for individual career development but also for building a skilled and resilient workforce for the future.

In a challenging cost environment, looking at creating efficiencies elsewhere in the business can be just as important for operators as managing labour costs - freeing up resource that can then be reinvested into people and business growth. This could include reviewing food and beverage costs and consolidating purchasing, or using menu engineering to understand where certain ingredients could be used more effectively - we can help with this, please get in touch with our team at customersupport@equinoxesolutions.com