Finance
UK minimum wage is raising youth unemployment, Bank of England's Mann says
Published by Global Banking & Finance Review®
Posted on February 15, 2026
2 min readLast updated: February 15, 2026
Quick Summary
Bank of England's Mann attributes UK's rising youth unemployment to recent minimum wage hikes, affecting 18-24 year-olds.
Bank of England's Mann: Rising Minimum Wage Linked to Youth Unemployment
Impact of Minimum Wage on Youth Employment
LONDON, Feb 15 (Reuters) - A sharp rise in Britain's minimum wage for younger workers over the past three years has contributed to an increase in unemployment for that age group, Bank of England policymaker Catherine Mann said in a newspaper interview on Sunday.
The unemployment rate for 18-24 year olds in Britain was 13.7% in the three months to November, up from 10.2% three years earlier and its highest since the fourth quarter of 2020.
Over the same three-year period, unemployment for the whole workforce has risen to 5.1% from 3.9%.
Current Unemployment Rates
Speaking to the Sunday Telegraph, Mann said she believed the rise in youth unemployment reflected disproportionately big increases in the minimum wage for that age group, rather than being a leading indicator for a broader rise in unemployment.
"I think we have to be very careful in the storyline about youth unemployment being the canary in the coal mine for a deeper deterioration in the labour market," she said.
Minimum Wage Increases Explained
"The accumulation over three years of the rise in the National Living Wage for that group has been manifested in unemployment for that category of workers. Very unfortunate, but it is true. It is a fact," she added.
Britain's minimum wage rate for 21-22 year-old workers has risen by 33% over the past three years to bring it in line with the 12.71 pounds ($17.35) hourly National Living Wage paid to older workers, while the rate for workers aged 18-20 has risen 46% to 10 pounds an hour.
Expert Opinions on Wage Policy
Britain's government has said it wants to bring the minimum wage paid to 18-20 year-old workers in line with older workers too.
Mann is a former chief economist at the Paris-based Organisation for Economic Co-operation and Development and voted against the BoE's last three rate cuts due to concerns about inflation.
($1 = 0.7327 pounds)
(Reporting by David Milliken; Editing by Susan Fenton)
Key Takeaways
- •Bank of England's Mann links rising minimum wage to youth unemployment.
- •Youth unemployment in the UK has increased to 13.7%.
- •Minimum wage for 21-22 year-olds rose by 33% in three years.
- •18-20 year-olds' wage increased by 46% to £10 an hour.
- •Government aims to align younger workers' wages with older workers.
Frequently Asked Questions about UK minimum wage is raising youth unemployment, Bank of England's Mann says
1What is minimum wage?
Minimum wage is the lowest remuneration that employers can legally pay their workers. It is set by law and varies by country and region.
2What is youth unemployment?
Youth unemployment refers to the unemployment rate among young people, typically those aged 15 to 24. It measures the percentage of this age group that is actively seeking work but cannot find employment.
3What is the National Living Wage?
The National Living Wage is the minimum hourly wage that workers aged 23 and over in the UK must be paid. It is intended to ensure a basic standard of living for employees.
