Young entrepreneurs can help unlock Britain’s economic potential
Steve Hare, Chief Executive Officer
| Sage
Helping more young people turn their ideas into businesses could create new routes into work and add almost £4bn to the UK economy by 2029
Every business starts with a person. Someone with an idea, a skill or the belief that they can build something for themselves.
At Sage, we see that entrepreneurial spirit every day. Some spot a gap in the market. Others turn a passion into a profession or seek greater control over their future.
Increasingly, young people are making that choice. They are starting out by starting up, creating their own route into work at a time when traditional routes are becoming harder to access.
People like Olivia Regan from Solihull. After leaving school without GCSEs, she started a cleaning business. At 23, she runs a growing company and creates work for others.
Christina Aaliyah from Newcastle took a different route. After training and working as a doctor, she focused full-time on the online business she had built. She now serves clients around the world.
Both chose to create their own opportunities.
Our latest report, produced with The Entrepreneurs Network, shows they are part of a wider shift. Drawing on 2.2 million anonymised Sage payroll records alongside ONS statistics, it finds that young people’s traditional routes into employment are narrowing. Payroll employment among 16 to 24-year-olds fell by 3.3 per cent between 2022 and 2025.
Meanwhile, youth self-employment has reached its highest level in more than a decade, rising from 4.5 per cent to 5.4 per cent.
For years, the focus of public policy has rightly been on helping young people find jobs. But this research raises another question: how can we help more young people create opportunities of their own and, in turn, jobs for others?
AI is making that path more accessible, helping aspiring entrepreneurs test ideas, manage their finances, automate routine tasks and reach customers. It cannot build a business for them, but it can remove barriers that might once have stood in their way.
That matters because the opportunity is significant. Nearly one million young people in the UK are not currently in education, employment or training. Analysis from economics consultancy Cebr suggests that helping even 5 per cent of these young people move into self-employment could create almost £4bn of additional economic value by 2029.
Part of the answer lies in ensuring that young people who want to start a business can access the guidance and support available through more traditional routes into work. A Startup Allowance could combine mentoring with practical guidance, while a Youth Enterprise Grant and a youth version of Help to Grow could provide the finance, digital skills and AI capabilities needed to turn a good idea into a viable business.
A new generation is ready to turn its ideas and ambition into businesses. The challenge now is to give more young people the skills, confidence and support to take that route if they choose to, and to recognise entrepreneurship as an important part of the answer to the UK’s youth employment challenge.
To read Starting Out and Starting Up: Making self-employment a route into work for young people and learn more about Sage’s recommendations, contact Ben Robinson at [email protected].
