The number of young people not in education or employment is poised to soar by nearly a third to more than 1.25 million over the next five years, according to a landmark report.

Alan Milburn is to publish the findings of a government review into youth worklessness on Thursday, warning that Britain will face a “lost generation” without urgent action.

The report will predict that the number of 16 to 24-year-olds not in work, education or training (Neet) risks surging by 33pc to 1.25 million by 2031, up from 957,000 today.

This would amount to one in six young people being classed as workless, compared with one in eight today.

The figures will highlight the scale of economic inactivity among under-25s, which Mr Milburn is expected to blame on a “whole-system failure”.

In particular, he will point to outdated health, education and welfare systems that are no longer fit to prepare young people for adulthood.

Mr Milburn, who was health secretary under Sir Tony Blair, will say: “This is not a failure of young people.

“It is a failure of a system stuck in the past. Whether it is education or health or welfare, that system fails to enable their participation in the labour market.

“Instead, all too often it ends up putting young people on a path to a life not in jobs but on benefits. This should be the priority for the Government. It should be the priority for all of us.”

He will also note how six in 10 young people classed as Neet have never had a job, compared with around four in 10 two decades ago.

“Detachment is no longer temporary,” he will say. “For too many young people it is becoming permanent. We are at risk of a lost generation.”

Pat McFadden, the Work and Pensions Secretary who commissioned Mr Milburn to carry out his review, said the findings “lay bare the scale of challenge and the root causes of youth unemployment we now need to confront”.

“We know there is more to do,” he added. “I will work across Government and with employers, charities and young people to drive real change, so more young people are earning or learning, not left behind.”