Eighty retail bosses have written to Keir Starmer warning that rising employment costs and regulation are choking retail’s role as a first-job route for young people.
The letter, coordinated by the British Retail Consortium, asks ministers to form a joint taskforce, simplify overlapping youth-employment schemes and reduce barriers including costs tied to hiring younger workers.
Retailers say Rachel Reeves’ NIC changes—raising the employer rate to 15% and lowering the threshold to £5,000—have added £6.5 billion in costs, while part-time youth hiring costs are up 13%.
ONS data cited by the industry showed 2.79 million retail jobs in Q1 2026, down 66,000 from a year earlier, as bosses also warn the Employment Rights Act will further curb flexible entry-level roles from 2027.
The appeal lands amid a wider youth jobs crisis: Alan Milburn’s report said more than 1 million young people are already NEET, with the total potentially reaching 1.25 million within five years.
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Youth Unemployment Crisis in the UK: Retail Sector Sounds Alarm as Entry-Level Jobs Disappear
Overview
In June 2026, over 80 chief executives from major UK retail and hospitality businesses united to send an open letter to Prime Minister Keir Starmer, highlighting severe pressures facing their sector. They warned that government-imposed costs and regulations are threatening the foundational pathways for young people entering the workforce. The retail industry, responsible for almost a quarter of all youth employment, is uniquely positioned to offer flexible, entry-level jobs and career progression. However, these crucial first steps are cracking, jeopardizing opportunities for young people to gain initial work experience and develop essential skills, and risking the loss of limitless potential for Britain.