If you don't run the business for profit, you just don't stay in business
In Britain, a quiet but consequential narrowing is underway at the base of the workforce. Lord Wolfson of Next observes that nearly twice as many young people now compete for each shop-floor vacancy as did two years ago — a doubling that speaks not to abundance but to scarcity. With youth unemployment at its highest in over a decade, the traditional stepping stones into working life are eroding, caught between rising employer costs, advancing automation, and the unresolved tension between worker protections and the conditions that make hiring possible.
- Youth unemployment among 16-to-24-year-olds has reached 16.2% — more than three times the national rate — signalling a generational squeeze on first-job opportunities.
- Next now fields 19 applicants for every shop role it posts, up from 10 just two years ago, as retailers and hospitality venues quietly pull back on entry-level hiring.
- Lord Wolfson argues that employer National Insurance hikes and minimum wage rises have added £70 million annually to Next's wage bill, pushing the company toward automation and leaner in-store staffing rather than more jobs.
- The government defends its policies as having raised pay for over 200,000 young workers and committed £2.5 billion to youth employment support, while the TUC insists the coming zero-hours contract ban will not meaningfully disrupt seasonal hiring.
- With the zero-hours ban taking effect next year and automation reshaping retail operations, the structural conditions for entry-level work may shift further before any resolution is found.
Lord Wolfson, chief executive of Next, has raised an uncomfortable signal from inside one of Britain's most resilient retailers: the number of applicants chasing each shop-floor vacancy has nearly doubled in two years, rising from roughly ten candidates to nineteen. For Wolfson, this is not a measure of enthusiasm — it is a measure of desperation, and a window into a deepening youth employment crisis.
The broader data supports his concern. Unemployment among 16-to-24-year-olds now stands at 16.2%, the highest since 2014 and more than three times the national average. The high street and hospitality sectors — long the traditional entry points for school leavers and students — have been quietly contracting their entry-level hiring, squeezed by rising costs and uncertain conditions.
Wolfson places much of the blame on government policy: increases in employer National Insurance contributions and minimum wage rises have added £70 million a year to Next's wage bill. The retailer's response has been to deploy fewer staff per store, invest in automation — self-scanning returns lockers, streamlined checkouts — and direct growth toward its online business. Each efficiency gain comes at the cost of a job that might have been someone's first.
The government's forthcoming ban on zero-hours contracts adds another layer of complexity. Wolfson does not challenge the principle of protecting workers, but argues that retail's seasonal rhythms — the surge of Christmas, the quiet of February — make indefinite guaranteed-hours contracts impractical. The likely outcome, he suggests, is simply fewer people hired overall, with students and casual workers losing access to the holiday work they rely on.
The government has defended its approach, pointing to wage gains for over 200,000 young workers, lower National Insurance rates for under-21s, and a £2.5 billion youth employment package. The TUC has argued the guaranteed-hours calculation will span several months and will not materially affect seasonal patterns.
Wolfson's deeper argument, however, is structural. Youth unemployment, in his view, is a symptom of broader economic stagnation — one that employment policy alone cannot cure. He points to planning restrictions that inflate land values from £15,000 per acre to £1.5 million once permission is granted, and calls for reforms to energy policy and transport investment as the real levers of growth.
Next itself continues to thrive — acquiring distressed brands, employing over 30,000 people, and raising its full-year profit forecast to £1.2 billion. Wolfson is unapologetic about profitability, noting that most retailers from 25 years ago no longer exist, and that survival is the precondition for any jobs at all. The tension between that logic and the government's push for stronger worker protections is unlikely to ease, and it is young people — waiting at the back of an ever-longer queue — who are absorbing the cost of the impasse.
Lord Wolfson, the chief executive of Next, arrived at a stark observation about the British job market: the retailer now receives nearly twice as many applications for every shop-floor position as it did just two years ago. Where Next once sorted through roughly ten candidates per vacancy, that figure has climbed to nineteen. The shift is not a sign of growing opportunity. It is, in Wolfson's reading, a window into a deepening crisis in youth employment that has begun to reshape how one of Britain's most successful retailers thinks about hiring.
The numbers bear out his concern. Unemployment among sixteen- to twenty-four-year-olds now sits at 16.2 percent—the highest rate since 2014 and more than three times the broader jobless rate of five percent. For young people seeking their first foothold in the workforce, the landscape has contracted sharply. High street retailers and hospitality venues—restaurants, cafes, pubs—have traditionally served as entry points for school leavers and students looking for part-time work. But businesses across these sectors have begun pulling back on entry-level hiring, citing a combination of rising costs and uncertain economic conditions.
Wolfson attributes much of the squeeze to government policy. He points specifically to increases in employer National Insurance contributions and rises in the minimum wage, both of which, he argues, have made it harder for retailers to justify creating lower-paid, part-time positions. Next's own wage bill has risen by seventy million pounds annually as a direct result of these changes, according to Wolfson. The retailer has responded by deploying fewer staff in individual shops while investing heavily in automation—self-scanning lockers for returns, streamlined checkout processes—and channeling growth into its thriving online business. The human cost of this efficiency is fewer opportunities for young people to gain experience.
Wolfson has also flagged the government's forthcoming ban on zero-hours contracts, which takes effect next year. The Employment Rights Act, as the government frames it, aims to eliminate what it calls exploitative arrangements by requiring employers to offer guaranteed hours to casual workers. Wolfson does not dispute the principle. But he argues the retail sector faces a particular bind: the seasonal nature of the business—the crush of Christmas hiring, the quiet of February—makes it difficult to guarantee the same staffing levels year-round. If forced to contract for those hours indefinitely, he suggests, Next will simply hire fewer people overall, leaving students and others who depend on holiday work with fewer opportunities to earn.
The government has pushed back on both fronts. A Treasury spokesperson noted that the minimum wage increase has boosted pay for more than two hundred thousand young workers and that employer National Insurance contributions are actually lower when hiring workers under twenty-one. The government has also committed a 2.5 billion pound youth employment support package aimed at delivering a million opportunities across the country. A Department for Business and Trade spokesperson added that the government's broader economic strategy has stabilized the economy and provided support for families and businesses. The Trades Union Congress, for its part, has defended the zero-hours contract ban, arguing that the guaranteed-hours requirement will be calculated over several months and will not materially affect seasonal hiring patterns.
Wolfson's broader argument, however, extends beyond employment policy. He contends that youth unemployment is ultimately a symptom of wider economic stagnation. The real solution, in his view, lies in structural reforms: loosening planning restrictions to free up land for development, overhauling energy policy, and investing in transport networks. The cost of an acre of agricultural land in the southeast of England hovers around fifteen thousand pounds, he notes, but jumps to as high as 1.5 million pounds once planning permission is granted. These bottlenecks, he suggests, are holding back growth across the entire economy.
Next itself remains a rare success story on the high street. The retailer has acquired struggling brands including Joules, Fatface, and Made.com, and now employs more than thirty thousand people across its operations. Earlier this month, it raised its full-year profit forecast to 1.2 billion pounds, with first-quarter sales up 6.2 percent. When critics suggest that Next is choosing shareholder returns over worker welfare, Wolfson counters that public companies are owned by hundreds of thousands of savers, many with modest holdings, and that the average dividend paid to an individual investor amounts to around three hundred pounds annually. More fundamentally, he argues, a business that does not generate profit does not survive. Over the past twenty-five years, seventy to eighty percent of the retailers that existed then have disappeared. Profitability, in his view, is not a choice but a prerequisite for longevity and, by extension, for the jobs that depend on it.
The tension between these positions—between the government's push for worker protections and wage growth, and Wolfson's argument that such measures constrain hiring—will likely intensify as the zero-hours contract ban takes effect and as the broader question of how to revive youth employment remains unresolved. Next's experience offers a case study in how policy, economics, and technology are reshaping the entry-level job market, with young people bearing the weight of the adjustment.
Citações Notáveis
That doubling of applicants for shop jobs is indicative of just how big the crisis is in youth unemployment at the moment— Lord Wolfson, Next chief executive
Youth unemployment is really a symptom of wider problems with employment in the economy, and of course, if you've got fewer jobs, the people who suffer most are the people with the least experience— Lord Wolfson
A Conversa do Hearth Outra perspectiva sobre a história
When you say the applicant numbers have doubled, what does that actually tell us about what's happening on the ground?
It's a pressure valve reading. When twice as many people are chasing the same number of jobs, it means the pool of available work has shrunk relative to the number of people who need it. For a young person, it means worse odds, longer waits, and probably lower wages in negotiation.
Lord Wolfson blames government policy—the National Insurance hikes, the minimum wage. But Next is also posting record profits. How do those two things sit together?
They sit uncomfortably, which is partly why he's being criticized. Next can be profitable and still claim that policy has made hiring harder. Both things can be true. But it raises a question about choices—whether the company is constrained by policy or choosing to prioritize margins over headcount.
The zero-hours contract ban—he says it will make seasonal hiring impossible. Is he right?
The mechanics are real. Retail does have genuine peaks and troughs. But the union argues the calculation happens over months, not day-to-day, which would smooth out the volatility. The honest answer is we won't know until it's implemented. What's clear is that Wolfson sees it as a constraint, and that perception alone may influence hiring decisions.
He keeps coming back to economic growth as the answer. Why does he think that solves youth unemployment specifically?
Because growth creates more jobs overall, and young people with no experience are always the last hired and first fired. If there are plenty of jobs, employers get less picky. They'll hire someone with no track record because they need bodies. When jobs are scarce, they'll demand experience you can't get without a job.
What about the students and young people who actually need these jobs? What's their stake in this argument?
They're caught between two competing visions. One says protect workers with guaranteed hours and better pay. The other says that protection will price them out of the market entirely. Neither side is entirely wrong, and neither has a clear answer for how to give a sixteen-year-old their first chance.