The double risk facing young people in Britain

0:11Simoney Kyriakou: Welcome to the latest episode of Margin Notes with me, Simoney Kyriakou, editor of FT Advisor. As you know, over the past year, this series has been looking at the theme of risk, risk in all of its various guises. and today we're looking at the risks affecting young people in Britain today. Well, really a double risk if you like. One, rising youth unemployment and two, low financial resilience. And when these combine, it can prove extremely damaging for young people and their prospects. So here to talk about this today is Lucy McElroy. She is a philosophy and language student at university and doing work experience with us here at FT Advisor.

0:51Simoney Kyriakou: Welcome Lucy. Thank you very much for having me. Now, thank you very much. Could you just introduce yourself and tell us a little bit about what are your goals when you graduate? As you said, I'm a philosophy and languages student at the University of Exeter and I'm set to graduate in July 2027. I would after that hope to upskill in some way. So I'm looking to take a master's degree or to become chartered in some area so that I can have more of a success in a standing career. Yeah, so it seems that people are having to do extra qualifications or do extra training and apprenticeships. Do you think it's going to be easy to get a job?

1:31Simoney Kyriakou: Are you feeling confident? I took a year out in my third year, which meant I'm one year behind most of my cohort. And I have seen them struggle somewhat in finding jobs. It seems to be a brutal process, especially because of the AI that is used in recruitment. The words they've used is soul sucking and you're often not faced. You don't come into contact with any human recruiters for a while, which is a bit demoralizing. yeah of course because human recruiters generally help you through your cv and your application process and can give you feedback whereas ai can just screen you out and you have no idea why you've been screened out and you might just get a generic response which is no um which is no no helpful really um were you sort of prepped at school and uni in terms of career or life admin um in terms of uni uh they they do there are services available for finding placements, for finding jobs at the other end of it.

2:29But I wonder whether the university hasn't quite caught up or universities in general haven't caught up with quite how difficult it is to find jobs. The statistics are brutal for every internship or graduate application. There are hundreds and hundreds of applications for every one place. For example, I looked at the civil service Faststream And in 2025, there were over 251 applications for just 600 vacancies, which is about a 1 % success rate. So I'm not sure if the universities have quite grasped how difficult it is. Is that 251 ,000 applicants? 251 ,000 applicants.

3:08Simoney Kyriakou: Yeah, that is incredible. Those numbers are sort of applicable on every scale. Last year, I went to an evening with a fund management consultancy. And they have seven placements that they offer for young people. And I think usually they have a few hundred applicants every year. And last year they had over 7 ,000. This is a significant increase year on year of people looking for jobs and trying to go further afield as well. And one of the things I feel that a lot of the job opportunities obviously are meant to be based in the cities and urban areas. But it's really difficult for young people then to make that move.

3:49Simoney Kyriakou: and that's why we're seeing so many young people staying at home for much longer with their parents. It's not just they're single, they don't want to move on to the housing ladder, they just don't have a job, right? Are your peers worried? Long term, probably a little bit and even short term. As you say, we need some sort of financial backing to be able to move to these big cities to have independence and to find a job eventually. And if we don't have the financial resilience, the financial skills and just that baseline funding, it's a lot more difficult to find a role, full stop. That's right.

4:25Simoney Kyriakou: And the statistics are backing this up. Seeing the Office for National Statistics saying that the NEETs, those not in employment, education or training, has reached 1.01 million and rising. And various statistics can sometimes put it up much further or slightly lower. But that's approximately 1 million young people out of the workforce. And it seems to be far worse in the UK than in other countries. It's around 14.8 % of young people in the UK, whereas the EU average last seen was 9%. So it's far higher. And in the Netherlands, it's just 4 % of young people who are NEETs. and so we really have a situation here and it's good to see the Prime Minister Andy Burnham trying to make changes into this he's introducing these skilled trades that were not introducing them but promoting them and putting money into that and hopefully that will make a difference but this seems to be a significant problem for the UK particularly Yes, he's got a big focus on practical skills which I think is going to go a long way and looking also at sort of financial education making sure that's embedded throughout the whole school curriculum.

5:33Simoney Kyriakou: But what more do you think that the government or companies could do to help young people get into the workplace? What would you like to see as a young person? It seems that companies are unwilling at the moment to hire young graduates. Studies from Indeed show that the graduate jobs postings are the lowest they've been since the lockdown, since 2020. And yet we've got the highest number of graduates ever. so it seems for some reason or other whether that's AI or whether that's fear for the future and unstability companies have taken a pause at hiring them and are even hiring more skilled and more experienced employees in the places of graduates which for those graduates trying to gain experience and trying to work hard proves a real problem.

6:23Simoney Kyriakou: I wonder if it's something to do with sort of the arts and humanities versus the technical skills. You know, if companies are trying to be AI savvy or to try and keep up with the AI revolution, maybe they're just sort of focusing on people with STEM skills rather than arts and humanities. And I do think that's a real shame. I don't think the humanities should be undervalued at all. And it seems to be, that seems to be the way that we're moving. At my university at Exeter, for example, there have been huge budget cuts quite controversially in the languages department and at the University of Nottingham languages has been taken out completely, which I do think in a world that is becoming more interconnected, we need to be aware of the humanities which teach us how to connect with one another cross-culturally.

7:08How to think, how to empathize. How to think critically and how to empathize, as you say, how to understand each other.

7:13Simoney Kyriakou: Yeah, that's a really significant point. And one of the things I like about financial advice, you know, I've interviewed so many financial advisors over my many years, working on financial advisor and FT advisor. And they've come from all different occupations. And many actually started out doing languages, French or German. Some are zoologists and some are color chemists. So there's a whole range and it's a slew of wonderful talent there. And you need all that difference. You need that differentiated thought and approaches to things. If you're going to provide a really good team of people that can look after clients, You need people from all over.

7:52Simoney Kyriakou: But I think you're right. Let's just touch on that AI because, you know, we're hearing a lot that entry level positions are being swallowed up by AI because a lot of entry level positions might have been secretarial or admin. If you can get Claude or some AI to do it for you, you don't need a young person. Is that a worry for you? Do you think you're going to need to be more AI savvy? that definitely is a worry and and it's a concern is as we're picking our future jobs actually should we be aware of this and should we be aware that we might be entering an industry that looks completely different in five to ten years um i think the most important thing is resilience and we've talked or touched on financial resilience and the ability to do that is very important but also adaptability and resilience within your career um i would be hugely looking to build skills that are adaptable and that I can bring to any career if AI does does change what what the job I enter look it looks like in the future yeah absolutely there was a 2024 micro was it 25 Microsoft study um which you can say if it's sponsored by Microsoft then it's probably going to be geared in one direction but uh they they put a list of the 40 most at-risk jobs when it comes to AI and 40 of the least at-risk jobs and on the least risk jobs with things like ship's engineer, dentist, massage therapist, you wouldn't really want an AI being a ship's engineer and you know certainly AI can't bend or do welding so perhaps again that focus from the government on more practical skills, apprenticeships is a really good thing and Andy Burnham giving more emphasis to that might also help some of these sort of hot spots for this in the regions you know where there has been this talent this natural talent and steelworks and ironworks that might actually help boost the regions but let's go on to on to resilience because you know on the one hand you've got sort of people coming out of university burdened with student debt which by the way you don't have in France either because a year's tuition fee at the Sorbonne for example is about a thousand euros for a UK citizen to go and study in France and 500 if you are an EU citizen so there you go um perhaps we should all be studying in France but um let's look at financial resilience so how well educated are you well let's ask you first and then about your peers as well um not naming any names because they might start listening to this but How well educated are you about financial matters?

10:20I don't believe that I was very technically literate or literate in financial terms until very recently. I started investing a couple of years ago, but that was self-initiated. And I read, I used online resources like brokers, resources that they put out. So whether that's BlackRock or Vanguard, they have resources which young people can use to learn about investing. And because of that, I feel like I was able to learn about it. But at school, certainly, I had no knowledge of how pensions work or taxes. And I really left school feeling quite nervous about it when I got my first full-time job during my gap year.

11:08I didn't know how to manage the money and how to deal with this sudden money coming in, having never had it before.

11:16Simoney Kyriakou: And, you know, that reading the first paycheck and you see all these abbreviations, NI and EET or, you know, CUM, you think, what is all this? I don't understand. Why is so much tax being taken out? You know, these are sort of things that you'd think would be basic financial knowledge. But, you know, the majority is sort of 16 to 25 year olds have very low financial literacy. and you know I'm also so pleased that you said you were looking at authorised regulated financial companies for your financial education online because I was dreading that you were going to start talking about your favourite social media influencer this is a real thing that's come up and I do find it extraordinary they're called influencers and this idea that that someone can can build a following by showing people what what they do to invest and these are people that are not at all qualified.

12:06Often, I do take that back, there are some chartered accountants and really qualified people talking about it, but there's no regulation in this. And I find that extraordinary that they are able to give financial advice, even if they put a disclaimer saying that this is not financial advice, there are people that will follow them.

12:24Simoney Kyriakou: Yeah, I mean, you could basically give three minutes of financial advice and then just stick a disclaimer saying this is not financial advice, but the damage is already done because impressionable young people who are coming out of university or college with no job prospects are looking at someone who seems young, who's in front of a Ferrari, which is probably not even there, it's probably just loaned or higher purchase, or even just found outside a hotel and they're leaning against it for the optics. You've got this aspiration suddenly, oh my gosh, I want to be just like this person. And they're saying, well, you can invest in crypto, all these crazy stocks.

12:59Simoney Kyriakou: It is quite a worry. And again, that there's a lot of jargon still in financial services. I mean, have you encountered jargon? Have you sort of understood all the different acronyms that we're doing? I've certainly encountered huge amounts of jargon. Even in reading the FT, it's difficult to get through if you're not within that world. But then that's a nice challenge to look up each word individually and it takes time. But still, there's plenty of jargon that I'm not familiar with and that I'm still learning. and there are basics so the basic of compound interest I'm pleased I I learned quite or at least at the start of my my journey into financial knowledge because that's a key a core one and then and you build from that but you're endlessly encountering words that you don't understand because it is a sector it's a professional sector that that I don't work in um and and oh yeah you never know you could become a great financial advisor I mean your family doesn't have a financial advisor does it so here is a little cheeky cheeky plug for uh for anyone um but i think you know having a financial advisor or having access to a financial advisor through your family it's a really positive thing because the the advisor can sit down with you can sit down with your family can talk throughout the whole generations and and give you some coaching um even if it's not sort of full-fart financial advice they can give kind of next generation coaching and i have heard that some firms are starting to do this very light touch advice for the next gen or very light touch coaching would you be interested in something like that have you encountered anything like that would you be interested in sort of face-to-face coaching i would certainly be interested in that and i've not encountered anything like it i i feel like i've had no exposure to financial advisors at all whether that's because i'm not their primary target audience um or whether the marketing has gone gone wrong somewhere but but i i think a worry for my age group would be the financial aspect of that in terms of cost.

14:53And I know actually a lot of Gen Z turn to AI for financial advice because it's this, it operates as a financial advisor, but without the cost. And that is possibly a danger to the individual, mostly because they're not regulated in the way that financial advisors are. And so I do think this huge opportunity to talk to Gen Z and to reach out to them.

15:19Simoney Kyriakou: Yeah, absolutely. And the trouble is AI at the moment, it's an echo chamber for your own thoughts. So if I could go to my AI, can you give me a really good financial plan for seven years? And then I'll say, actually, no, set the goal for five years. Actually, no, give me a big spending pot. And each time I say, yes, of course, that's a great idea. You can have a really big spending pot. So it only just then reiterates what I'm feeding it and it's just sort of learning from what I've given it and that's a very dangerous thing to have it's not really a critical friend it's an encouraging friend and sometimes encouraging friends are the ones most likely to get you into trouble as my own friends would probably say of me but that's a situation that we're facing and then of course we don't even know what agentic AI is going to do because it might actually start making these financial decisions for you while you're discussing it.

16:09Simoney Kyriakou: So, you know, I asked someone who was a specialist once, is there going to be an off button when it comes to agentic AI? And he sort of looked and said, well, we hope so. That was encouraging. But let's talk about sort of financial planning as a profession. Had you sort of come across it as a profession before you sort of talking to FT Advisor? Not really. and it sounds very interesting because of the way that it's analytical but it's also people based and not really at all it comes back to I would love to have more exposure to that whether in schools or at university both as a career and for my generation as clients.

16:48Simoney Kyriakou: Yeah and I think that would really help with financial resilience as well if you can just go into a school and deliver some basics maybe talk to a 16 year old about compound interest they can start their journey a little bit earlier than you started. But let's just touch, while we've got a few moments now, on the stereotypes. You know, we've got stereotypes around Gen Z that they're lazy or they're entitled or they only want to work flexibly or they want to work hybrid. They don't want to be in the office. They don't want to put in all the hard graft that we used to. What sort of myths would you like to bust?

17:20I think this is a hugely difficult topic. And when you're facing stereotypes like these, that is a challenge. and I would like to see any sort of backing or evidence for that because from my perspective and within this peer group, I see a generation that's hugely entrepreneurial and have endless side hustles to try and make more money because we're struggling financially, whether that's to gain a mortgage or to just get by. I see people working very hard, two or three jobs, and often using AI and using these new tools like the internet to make more money or to find a new career. And it's really, it comes from within.

18:02I find it hugely amazing when I see things like that. And then also we have the statistics of NEETs, young people out of work, but then you look at the statistics of actual graduate jobs that are available and 84 % of NEETs want to find work or want to be in employment or training. I do wonder whether the statistics about the number of meets are misleading because it potentially implies that it's that's the fault of the young person. And I don't think it I think it often isn't.

18:37Simoney Kyriakou: Yeah, and I think post-COVID as well, it's very difficult because a lot of Gen Z sort of came of age or sort of either university age or working age during COVID when everything was in lockdown. So they never had any experience of being in an office. And then sort of 2021 was starting to come back into the office. 2022, it's more hybrid working. And now there's sort of a push for a four or five day week and back to as it was, which is normal for people like me. But for young people who had no experience of an office life or no experience of a being in the presence of other people working collegiately with them, you know, suddenly come back into a full five day week.

19:17Simoney Kyriakou: It's quite a big, a big jump. And another thing I find that when I'm hiring as well, I always am mindful that sometimes people are applying from outside of London and they have to find somewhere to live, which is really expensive because you have to put a deposit down and you don't get paid for a whole month. You know, you get paid at the end of the calendar month. So, you know, there was one young lady I hired about three or four years ago who was living in Dublin. And I said, you can carry on living in Dublin for a month or two until you get your first or second paycheck. Get enough money to get yourself a deposit or, you know, to pay the deposit to your landlord up front.

19:59Simoney Kyriakou: So then you can come and find somewhere. And she was really grateful for that. But she was really good and I didn't want to miss out on that really good talent just because I couldn't have her physically with me for a month in the office for two months. And yes, it was a little bit more work for myself to kind of make sure I was always online with her and make sure that her line manager was always going to be online. But we got some really great talent for a year and a half. So this is, I think companies need to be a little bit more proactive and a little bit more thoughtful. If you're trying to get young people and you're saying, oh, they're not interested in applying, then maybe there's something about your job advert.

20:31Simoney Kyriakou: you must be in the office five days a week from day one. Not thinking about young people, not having the money to even travel into the location. So, yeah, it's a difficult one. If companies could be more flexible like that, I think that would help a lot and make a big difference. And also to be aware that a lot of young people, as you say, haven't had work experience because of things like the lockdown. I know anecdotally, a lot of the work I had lined up for the summer after my GCSEs was cancelled. because of it and jobs like hospitality or even basic office jobs that people might have had on a Saturday or during their gap year are disappearing.

21:11It's far fewer people have second jobs or early jobs like that. So flexibility and understanding in that would be great.

21:21Simoney Kyriakou: Absolutely. Well there's a rallying cry for the financial advice profession to help end this epidemic of needs which is a very unfortunate collective noun for that i'm sure we can think of something much better but here we go we can perhaps take away the jargon from our websites and from our job adverts we can perhaps reach out more to young people and help provide more information or light touch or next generation guidance and perhaps also encourage ourselves and our peers to think about work experience opportunities, shadowing opportunities, and getting more young people into employment. Well, thank you very much again, Lucy, for talking to us.

22:02Simoney Kyriakou: Thank you so much for having me. And thank you for listening. Until next time, take care.

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