As a father of six, I find myself thinking more often about the world of work my children are likely to enter.

Yestrday, the BBC recently reported that overall UK unemployment has risen to 5.1%. That is concerning in itself. But the more sobering figure is youth unemployment, which now sits at 16.4%.

I don’t believe this is simply a short-term economic wobble. I think something more structural is happening. Our young people are coming of age at a time when policy decisions have materially increased the cost of employing them, while at the same time technology is advancing at a pace that allows businesses to automate many of the tasks traditionally carried out in entry-level roles.

A Lesson I Learned Early in Business

One of the first lessons I learned in business was that you have to leave something in the deal for the other person. If the scales tip too far in favour of one party, the arrangement rarely works well for either side over time.

We’ve seen this dynamic play out in other areas of the economy. The landlord–tenant relationship has been reshaped significantly by recent policy changes, and many landlords have responded by leaving the market. Whether or not you agree with the direction of travel, the behavioural response was predictable. When incentives change, behaviour changes.

Employment markets are no different.

The Cost of Entry-Level Labour Has Shifted

I recently looked at minimum wage growth since 2015 and adjusted it for both inflation and productivity growth. In other words, I wanted to understand the real economic cost per unit of output, rather than simply the headline wage figure.

The results are striking.

Since 2015:

• Adult minimum wage labour is roughly 31% more expensive per unit of output.
• Youth minimum wage labour is around 35% more expensive.
• Apprentice labour is more than 60% more expensive.

These figures do not include increases in National Insurance or the cumulative impact of additional legislation and compliance requirements. They simply reflect the adjusted cost of employing someone at those wage levels.

For much of that period, businesses had little alternative. If a task needed to be done, it required a person.

That is no longer the case.

The Technological Alternative

We are now in a world where relatively inexpensive, increasingly capable technology can handle many of the routine tasks that once justified entry-level hires. Booking appointments, responding to enquiries, processing data, generating reports, and even elements of customer communication can be automated or augmented.

The cost of deploying these tools continues to fall, while their capability improves.

It would be unrealistic to expect businesses not to factor that into their decisions. When labour becomes structurally more expensive and automation becomes structurally more viable, the rational response is to consider substitution, at least for certain categories of work.

Incentives Matter

This is where my concern lies.

If the cost of employing young people rises at the same time as viable technological substitutes emerge, we should not be surprised if youth employment comes under pressure. Businesses respond to incentives. If the “deal” no longer feels balanced, behaviour adjusts accordingly.

In my view, this is not a moment for additional penalties. It is a moment for thoughtful incentives.

Targeted support for youth employment, reductions in employer costs for training roles, and structures that reward businesses for developing young talent would help to rebalance the equation. Encouraging hybrid models that combine technology with structured learning could also ensure that young people gain meaningful experience rather than being displaced by automation.

The objective should be alignment, not opposition.

Designing the Future of Work Intentionally

Technology is not the enemy. In many cases it improves productivity and frees people to focus on higher-value work. In my own industry, I talk often about “High Skill / High Tech” — using automation where it makes sense, and elevating human involvement where judgement and trust genuinely matter.

However, if we accelerate the replacement of entry-level tasks without creating pathways for young people to develop those higher-value skills, we risk narrowing the on-ramp into the workforce.

As a business owner, I understand the pressures of margin and efficiency. As a father, I am more focused on opportunity.

I believe passionately in upskilling and paying higher wages. But when we start out careers young people build confidence, discipline, commercial awareness and resilience. If the system of incentives unintentionally reduces those entry points, the long-term consequences will be huge.

A Call for Balance

I am not arguing against wage growth, nor against technological progress. Both have their place. What I am arguing for is balance. If you make our young people less competitive in a time that they technology is becoming more capable, the consequences are obvious.

When policy, economics and technology move simultaneously, the effects compound. That requires careful design and a clear understanding of incentives.

If youth unemployment is rising while automation accelerates, we should be asking whether the framework around employment is aligned with the realities businesses face.

Because if the deal works for both sides, participation increases. If it doesn’t, businesses adapts.

And as someone raising six children who will step into this world of work over the next decade, I hope we get that balance right.