young people

Insights into small businesses and youth employment prospects


A new report on understanding the youth labour market, now available to download, has suggested ways that small and medium enterprises can overcome perceived barriers and work with young people to improve their economic prospects.



EY Foundation commissioned Dr Rachel Doern, Reader in Enterpreneurship at the Institute of Management Studies at Goldsmiths University of London to research small and medium-sized enterprises (SMEs) based in South East London.


The report, entitled 'Understanding the main opportunities and barriers to SME engagement with the youth labour market' draws on the results of a longitudinal interview-based study of 20 SMEs and their perspective on and experience with young people.


The study identified six perceived opportunities from engagement with the labour youth market for SMEs, and 10 perceived barriers that stand in the way.


The perceived opportunities were:

  • Diversifying the business and industry
  • Bringing fresh perspectives to client projects
  • Energising the company brand
  • Enhancing external communications
  • Improving internal work processes
  • Developing a social purpose and conscience


The perceived barriers were:

  • Lack of access to young people
  • Lack of understanding of young people
  • The associated costs of working with young people relating to finances and staff time
  • Lack of support infrastructure in SMEs
  • Fear of having a negative experience
  • Lack of interest from young people in the work
  • Rigid features of work placements
  • Work placement bureaucracy and communications
  • Shifting work patterns due to the pandemic
  • Fears focusing on recruiting young people could distract from pandemic recovery efforts 


The report indicates that while SMEs are destinations for young people, a number of perceived barriers stand in the way of these businesses engaging more fully with young people. Improving employment prospects for young people will depend on addressing these barriers and exploiting the opportunities and the report makes a number of recommendations for how this can be achieved in each case.


Responding to the report’s findings, Interim CEO of EY Foundation, Jodie McNally said:

It’s great to see that SMEs want to work with young people and to also see an acknowledgement of the energy and insight a more diverse talent pool can contribute to every workplace. This report showcases the benefits of – and perceived barriers to – working with young people, providing a basis for SMEs to come together to close the gap between wanting to engage with the youth labour market and actively employing young people.

Dr Doern, the report author, said:

In speaking with SMEs owners, I was rather struck by the overwhelmingly positive attitudes they had towards working with young people, and the firmness of their beliefs that young people could add value to businesses. At the same time, the reality for many of these SMEs was that their direct experience of working with young people was limited to small numbers, and few employed young people from low-income backgrounds specifically.