New criterion for government contracts focuses on job creation

On August 4, 2026, the United Kingdom government announced that, from now on, companies wishing to take part in public contracts must demonstrate how they will create jobs for young people, instead of proving their environmental commitments.

Evaluation criterion now prioritizes jobs

Central departments will increase the weighting of the social value of contracts from the previous 10% of the decision to 20%. However, the focus will shift from generic social good to requiring companies to create positions paying above the minimum wage, provide training, practical experience and fill local skills gaps. Contracts worth less than £1 million are exempt from the new requirement.

Goal to reduce NEET youth

The measure is part of a government effort to reduce the number of young people not in education, employment or training (NEET) and to boost regional growth. Public contracts account for about £90 bn per year, a resource the government intends to channel into jobs, skills and people in every postcode.

Reaction from environmental groups

Environmental organisations criticised the swap of green targets for a focus on employment. Ami McCarthy, policy head at Greenpeace UK, said that “protecting the environment and helping young people secure good jobs are mutually beneficial and should not come at each other’s expense”. Rosie Downes, campaign lead at Friends of the Earth, warned that “communities already pay the price of environmental inaction, with record levels of heat-related deaths”. Sarah Williams, director of strategic partnerships at the Green Alliance, reinforced that “eliminating climate and sustainability requirements is not the solution”.

Small-business outlook

Louise Haigh, Secretary of State, said the change will help small businesses, which are often excluded from contracts due to green-proof requirements that large corporations circumvent. “Every penny of taxpayer money must benefit local communities, creating good jobs and providing skills for the future,” Haigh said.

Developments and further criticism

A Labour Party source noted that the government had already anticipated criticism for removing social-value indicators tied to the environment. According to the source, “what companies need to do today looks a lot like a checklist exercise, and this turns into bureaucracy rather than delivering real results”. The new criterion will also be assessed for its support of NEET youth, people who have left the care system, and individuals with long-term health conditions.

With information from The Guardian.