In a stark warning to policymakers and business leaders, the head of Britain's largest supermarket chain has declared that the nation is "sleepwalking into a quiet epidemic" of joblessness, with millions of people out of work and reliant on benefits.
A Call to Action on Economic Inactivity
Ashwin Prasad, the UK chief executive of Tesco, delivered his urgent message at an event hosted by the Resolution Foundation thinktank in London. He argued that far fewer people are in employment than should be the case, with taxpayers footing an increasingly large bill for out-of-work benefits.
"We cannot afford to be a country that lets the next generation languish on the sideline," Prasad stated, criticising what he sees as insufficient government efforts. He called for an end to "tinkering at the edges" of the problem and demanded bold, collaborative action between the public and private sectors to reverse the trend.
The Scale of the Challenge
Official data released last month placed the UK's unemployment rate at 5.1%, marking a four-year high. However, the issue extends beyond traditional unemployment figures.
More than 9 million people aged 16 to 64 are currently classified as economically inactive, meaning they are not actively seeking employment or available to start work. This troubling statistic includes:
- 2.9 million individuals aged 16 to 24
- Almost one million young people not in education, employment, or training – representing a 26% increase from pre-pandemic levels
Analysis from the Centre for Social Justice thinktank further reveals that over 700,000 university graduates are out of work and claiming welfare benefits, highlighting that the problem affects all educational backgrounds.
Root Causes and Corporate Responsibility
Prasad acknowledged "myriad reasons" behind the high levels of economic inactivity, noting that life has been "incredibly challenging" for lower-income households amidst prolonged political instability and economic uncertainty.
From his perspective as a major employer, Prasad emphasised: "This means instead of investing in parts of national life that might stimulate investment and growth into the wider economy, we are spending an ever increasing proportion of our national income on our out-of-work benefits."
Tesco, as the UK's dominant grocer and largest private-sector employer with over 300,000 staff across the UK and Republic of Ireland, finds itself at the heart of this national conversation. The retail giant has faced criticism regarding executive pay disparities, particularly when group chief executive Ken Murphy received £9.9 million in pay and perks during the 2024 cost of living crisis – over 430 times the average Tesco employee's earnings.
Prasad defended Tesco's record, noting the company's "good financial health" and highlighting that the highly profitable retailer has invested an additional £1 billion in wages over the past five years. He positioned the retail sector as one of the best pathways into employment, offering flexible opportunities that support people entering or re-entering the workforce, particularly those with childcare or caring responsibilities.
Government Response and Future Directions
In December, the government announced an £820 million funding package aimed at helping more young people into work or onto learning schemes. While this represents a step forward, Prasad's comments suggest much more comprehensive action is required to address what he describes as a "clear, gradual change" over the past decade of people falling out of work.
The Tesco chief warned that the current situation is damaging Britain's standing on the world stage and requires immediate, coordinated intervention to prevent further economic and social deterioration.
