Youth self-employment hits decade high, 27,500 above 2022

By Grace Kim

Moving even 5% of young people into self-employment could create almost £4bn in additional economic value by 2029, according to Cebr analysis cited by Steve Hare, CEO of Sage. Hare uses that estimate to argue that entrepreneurship has become a mainstream route into work for young people struggling to enter traditional employment. His prescription combines targeted policy with practical digital skills, especially AI.

What do the numbers show?

Hare reports that youth self-employment has reached its highest level in a decade, with 27,500 more under-25s working for themselves than in 2022. He says the shift shows young people are acting rather than waiting for conventional hiring routes to open.

He adds that AI could make self-employment more accessible and affordable by providing capabilities that previously required specialist expertise. For Hare, technology lowers the barrier to starting a company, but it does not replace the ambition and work required to sustain it.

What does the Autumn Budget change?

In Hare's assessment, the government has rightly recognized that young people face a harder route onto the first rung of traditional employment. He identifies the Young Entrepreneurs Allowance in the Chancellor's Autumn Budget as an encouraging step. Hare says the allowance will help cover living costs for young people in their first year of running a business in England.

The measure, in Hare's view, sends a pro-entrepreneurial signal. He puts the case plainly: “Starting a business is a legitimate route into work, and successful businesses can go on to create jobs for others.”

Hare says the government should do more while keeping conventional routes central:

• Continue supporting apprenticeships, graduate programmes and other paths into employment.
• Provide mentoring with practical guidance for young business founders.
• Create a youth version of ‘Help to Grow’ that teaches digital skills and AI capabilities needed to turn an idea into a viable business.

Hare's message is simple: young founders need economic support, practical advice and digital skills together.

How are young founders using AI?

Hare profiles two entrepreneurs who use AI to run and grow businesses with very different models.

Olivia Regan, 23, launched her Solihull-based cleaning company in 2024 after leaving school without GCSEs. Her business supports a network of freelancers and generates £10,000 in monthly revenue, according to Hare. She uses AI tools to set pricing, generate marketing ideas and identify new customers.

Christina Davis, 25, took a different route after qualifying as a doctor and building an online audience as a hobby during the pandemic. Hare says Davis began running her Newcastle-based growth marketing business full-time in January 2026.

Within three months, she had matched her previous salary. She now serves clients around the world and uses AI to identify leads and analyse marketing performance. In both cases, Hare presents AI as a practical tool that reduces the need for specialist expertise.

Can entrepreneurship ease the youth employment crisis?

Hare presents AI as an enabler, not a substitute for founder drive: “Technology can help make starting and running a business easier, but the ambition and hard work still come from the individual.” He uses Regan and Davis to show what he says young people can achieve when they have a chance to put an idea into practice and run with it.

His conclusion is that a new generation is ready to turn ideas and ambition into businesses. The remaining challenge, he says, is to give more young people the confidence and support to choose self-employment and to treat entrepreneurship as part of the answer to the UK's youth employment crisis. His answer is not entrepreneurship instead of employment support, but entrepreneurship alongside it.

The near-term test is whether mentoring and AI-skills provision can help more young people build businesses that create jobs. For Hare, the stakes are measurable: moving only 5% of young people into self-employment could add almost £4bn of economic value by 2029.