Care Leavers Locked Out of Work in England

The Drive Forward Foundation's March 23, 2026 reporting, covered in The Guardian, highlights that care-experienced young people in England remain substantially disadvantaged in access to employment: they are reported as "almost three times more likely to be out of work than their peers" (Drive Forward Foundation / The Guardian, 23 Mar 2026). The headline statistic has rapidly become a focal point for policymakers and corporate diversity leads because it juxtaposes broad employer goodwill with limited operational change. Employers, according to the reporting, frequently indicate a willingness to hire care-experienced candidates but have not materially altered recruitment processes to remove structural barriers. The gap between stated intent and implemented practice raises questions for HR governance, public policy, and long-term labour-market inclusion in the UK. For institutional stakeholders, the development highlights non-wage labour-market frictions with potential social and economic externalities that merit closer monitoring and corporate engagement.

Context

Care leavers have been an explicit target of UK social policy for years, with successive governments and local authorities focused on outcomes for young people leaving local authority care. The Drive Forward Foundation's March 2026 survey and The Guardian's coverage (23 Mar 2026) place the employment shortfall in a sharper light by comparing care-experienced young people directly with their non-care peers. Historically, longitudinal DfE and third-sector monitoring has shown persistent gaps in education, housing stability, and employment outcomes for care leavers; the recent coverage indicates these gaps remain acute into the mid-2020s. The problem is not solely a labour-demand issue: it reflects systemic discontinuities between leaving-care support structures and employer recruitment architecture.

The UK labour market since 2021 has exhibited tightness in many sectors, yet structural mismatch persists for worker cohorts with atypical CV trajectories. Employers report hiring intentions for underrepresented groups broadly, but intention does not always translate to process redesign such as anonymised CVs, flexible interview formats, or tailored onboarding—measures frequently cited by social organisations as effective. The Drive Forward finding that care leavers are almost three times more likely to be unemployed than their peers signals that the conventional hiring funnel filters out candidates who do not conform to standard markers of stability. For fund managers and corporate risk teams, that filter represents both a reputational risk and a potential source of untapped talent if business models support alternative hiring pathways.

The political context is relevant. Ministers and local authorities face competing fiscal pressures, and employers operate under regulatory, cost and cultural constraints. The combination of advocacy-driven reporting and employer signalling may create a window for coordinated policy and voluntary corporate commitments, but prior campaigns demonstrate that durable change requires measurable commitments—targets, timelines, and independent monitoring. Institutional investors and corporate boards increasingly integrate social outcomes into governance frameworks, and the persistence of a 3x disparity provides a measurable KPI for stewardship activity and social performance assessments.

Data Deep Dive

The core quantitative anchor in recent coverage is the phrase "almost three times more likely to be out of work than their peers" (Drive Forward Foundation; The Guardian, 23 Mar 2026). That comparative ratio is particularly useful because it is relative rather than absolute: it draws attention to the differential without relying on a single unemployment rate that could vary by age band or geography. The Drive Forward Foundation’s survey, published 23 March 2026, frames the issue as one of process rather than pure preference—employers indicate openness to hiring care-experienced individuals but report making few recruitment adaptations. The primary source is the Drive Forward Foundation and the reporting outlet is The Guardian; both should be consulted for survey methodology and sample-size detail before operationalising outcomes.

For context, the differential should be compared with other known labour-market inequalities. For example, research on young people with criminal records, disabilities, or certain ethnic minorities often reports elevated unemployment relative to majority peers, but the magnitude and causal pathways vary. The 3x ratio for care leavers suggests a magnitude that is comparable to some of the largest inclusion gaps observed in the UK labour market. Investors and analysts assessing human-capital risk should therefore treat care-leaver outcomes as material where workforce composition, talent pipelines, and brand reputation intersect.

It is important to underline the limitations of the published figures: the Drive Forward results, as reported, summarise employer attitudes and relative unemployment risk but do not provide a full causal map linking recruitment process features to final hiring outcomes. Nor do the summaries disclose sectoral breakdowns, regional variations, or the precise employer sample frame. For high-conviction stewardship or policy action, stakeholders should request the underlying survey instrument and cross-tabulations by sector, employer size, and geography to determine where interventions would be most effective.

Sector Implications

Different sectors will be affected unevenly. Labour-intensive service sectors that rely on entry-level hires—retail, hospitality, social care and logistics—may see the largest near-term opportunities to absorb care-experienced candidates if recruitment processes are adapted. By contrast, highly credentialised sectors such as financial services, legal, or specialised engineering may require more substantial pathway programmes combining accredited training with work placements. The Drive Forward findings signal that many firms across sectors are not yet prepared to deploy those pathway structures at scale despite professing willingness to hire.

For corporate diversity, equity and inclusion (DEI) teams, the finding creates an actionable metric: the gap between stated hiring intent and concrete process change. Boards and remuneration committees that link DEI delivery to executive incentives may consider adding specific measures—e.g., number of hires from care-experienced backgrounds, time-to-hire for those candidates, or adaptations implemented to recruitment pipelines. Institutional investors with stewardship responsibilities can press for disclosure of such metrics in sustainability reporting and compare progress year-on-year (YoY) against peers.

From a workforce planning perspective, employers that proactively redesign recruitment to remove documentary barriers and introduce supported onboarding can access a stable pipeline of motivated candidates. That potential has cost implications—short-term investment in training and support may yield medium-term reductions in turnover and recruitment costs. For sectors facing chronic vacancy pressure, changing the entry funnel could be both socially beneficial and operationally efficient.

Risk Assessment

There are three principal risks to consider. First, reputational risk: public reporting that employers are not translating intent into action can damage brand standing, particularly for consumer-facing firms with DEI commitments. Second, operational risk: firms that underinvest in inclusive recruitment may face persistent skills shortages in entry-level roles, increasing reliance on agency labour with higher cost and lower retention. Third, policy risk: failure to act could invite regulatory or mandatory measures from government aimed at improving outcomes for care leavers, including procurement-linked requirements or conditionality on public-sector contracts.

Mitigating these risks requires measurement and governance. Employers should be encouraged to collect anonymised data on care-experienced applicants and hires, to monitor funnel metrics (application-to-interview, interview-to-offer, offer-to-acceptance rates) and to report progress. Where data collection is sensitive, third-party intermediaries—non-profits like the Drive Forward Foundation or specialist intermediaries—can provide privacy-preserving frameworks to validate outcomes. Institutional investors can support these mechanisms through stewardship engagements, proxy voting and constructive dialogue with corporate leadership.

Finally, there is a macroeconomic risk: if large cohorts of care-experienced young people remain excluded from stable employment, the fiscal and social costs—higher welfare dependency, increased public health spend, and lower lifetime tax receipts—could become material for government budgets. Although those costs accrue over years, they affect long-term public finances and therefore the macro backdrop for investment decisions in the UK.

Fazen Capital Perspective

Fazen Capital views the Drive Forward finding as both a social challenge and an under-recognised allocational signal. The nearly 3x unemployment differential for care leavers is an indicator of institutional friction within hiring markets—one that can be addressed through targeted operational changes rather than solely through further public subsidy. From a stewardship standpoint, we see an opportunity for concentrated engagement: pressing large employers in high-turnover sectors to pilot anonymised application streams and supported apprenticeship pathways could generate scalable models with measurable ROI. Our contrarian read is that the fastest route to narrowing the gap is not top-down regulation but a combination of corporate pilots, third-sector partnerships, and low-cost process redesigns that can be replicated across firms. We recommend investors evaluate companies on both intent and demonstrable process change, and to prioritise engagements where labour-market tightness makes the business case for inclusion particularly compelling.

At the portfolio level, exposure to sectors that can readily adapt recruitment (retail, social care, logistics) should be assessed for both upside from improved workforce utilisation and downside if firms fail to operationalise stated commitments. We encourage clients to request granular disclosure from investee companies and to support independent evaluations of pilot programmes. For further context on how labour-market signals influence investment decisions and active stewardship, see our broader perspective on youth employment and labour market trends.

Outlook

If employers respond with concrete process changes—such as flexible interview formats, documentary flexibility, on-the-job training and mentoring—the rate of successful hires from care-experienced cohorts could rise materially in the next 12–24 months. However, absent measurable commitments and external verification, the default expectation should be slow progress: goodwill without process typically yields incremental rather than structural change. Policymakers can catalyse faster movement by linking procurement or apprenticeship funding to demonstrable outcomes for care leavers.

Scenario analysis suggests two plausible trajectories. In a positive scenario, a handful of large employers pilot pathway programmes in 2026–27, demonstrate reductions in turnover and vacancy-fill times within 12 months, and prompt replication across sectors. In a negative scenario, nominal employer commitments remain unexecuted, the 3x differential persists, and public pressure leads to prescriptive regulation that raises compliance costs without necessarily improving employment outcomes. Institutional stakeholders should prepare for both paths by seeking transparency, outcomes-based targets and independent monitoring.

For monitoring, the priority metrics are relative unemployment rates for care leavers, funnel conversion rates within hiring processes, and YoY hiring counts for care-experienced candidates. Investors and corporate boards should set time-bound objectives for these KPIs and assess progress as part of annual reporting cycles.

Bottom Line

The Drive Forward Foundation’s reporting (The Guardian, 23 Mar 2026) that care leavers are almost three times more likely to be out of work than peers is a clear signal of persistent structural barriers in hiring. Institutional actors—employers, investors and policymakers—should prioritise measurable, low-friction process changes to translate goodwill into outcomes.

Disclaimer: This article is for informational purposes only and does not constitute investment advice.

FAQ

Q: What practical recruitment changes have evidence of effectiveness for care-experienced candidates?

A: Proven operational changes include anonymised CVs to reduce bias, structured interviews with competency-based scoring, paid internship-to-hire pathways, and dedicated onboarding mentors. Independent charity–employer partnerships that provide wraparound support (housing advice, mentoring) also improve retention; pilots typically report reductions in early turnover within 6–12 months, although pilot-scale evidence should be validated before scaling.

Q: How have similar inclusion gaps been addressed historically in the UK labour market?

A: Historic precedents include Disability Confident employer initiatives and supported apprenticeships for young people with learning difficulties. These programs underscore that successful models combine employer incentives, adjusted process design and third-party support. The key lesson is that legislative signals help create momentum, but durable change requires employer ownership of process redesign and measurable targets.