The latest figures showing youth unemployment at 16.1 per cent confirm that the National Minimum Wage has ceased to be a “floor” and has instead become a rationing mechanism.

Perhaps most damning is that the Labour government has now all but abandoned its manifesto promise to equalise the minimum wage across all age groups. By deferring to the Low Pay Commission’s “cautious” tiered structure for 2026, the government has tacitly admitted it does not trust the labour market to absorb young workers at the full adult rate.

Equally telling are the opposition parties’ positions: they accuse Labour of “killing off first jobs for the young” through rising costs, while continuing to rely on a state-mandated administrative discount for the young. In doing so, they avoid exposing a systemic market failure—the total absence of an “experience curve” in the UK’s wage structure.

If the labour market were functional, “the cost of employing an inexperienced 18-year-old” could never “resemble the cost of hiring someone older and already trained”. Yet, in our demand-deficient economy, employers do not bid up for reliability or tenure; they simply cluster these workers at the statutory minimum. The tiers are not a ladder; they are a fig leaf covering the fact that the private sector is no longer rewarding added value.

We are trapped in a cycle of redistributing scarce opportunities. Instead, we should introduce a Minimum Wage Jobs Framework. By allowing the public and third sectors to offer guaranteed work at the minimum wage, funded via the DWP and managed through existing PAYE systems, we could eliminate involuntary unemployment by design.

Only when the state guarantees a job at the minimum wage will the private sector be forced to bid higher for experienced workers and correct the ritual underpricing of labour. Without this mechanism, a minimum wage for all remains a promise that no side of the House is able to keep.

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