Youth unemployment among 16-24-year-olds has climbed to 16.1%, the highest point since early 2015, according to the Office for National Statistics. This surge now exceeds the EU average for the first time in recorded history. The National Hair & Beauty Federation (NHBF) argues that rising employment costs are directly preventing businesses in the sector from hiring these young people as apprentices.
The UK's £5.8 billion hair and beauty industry, which supports approximately 220,000 jobs, relies heavily on developing its own talent. However, businesses report that recent policy changes have made taking on new staff financially unviable. An increase in employer National Insurance Contributions (NICs) from 13.8% to 15% and a reduction in the NICs Secondary Threshold from £9,100 to £5,000 are significant factors. Compounding these are substantial rises in the National Living Wage and new employment rights, such as day-one paternity leave and stricter rules on zero-hours contracts.
These combined pressures disproportionately affect the small and micro businesses that dominate the hair and beauty sector. For an owner operating on tight margins, the increased cost of employing an apprentice, often an entry-level position, has become prohibitive. The NHBF points out a contradiction in expecting small businesses to create apprenticeships while simultaneously increasing the financial burden of employment.
The sector has traditionally served as a crucial pathway for young people seeking vocational careers. Apprenticeships in hairdressing, barbering, and beauty therapy offer hands-on training and a clear route to employment. Failing to secure early employment can have long-term negative impacts on earnings and career progression. The NHBF is urging the government to review the NICs threshold for apprentice wages, ensure skills funding reaches small businesses, and consider VAT reform to improve cashflow, enabling investment in training.
