The Government should provide businesses with incentives to take on British teenagers instead of migrant workers and older applicants, the head of a leading business organisation says.
John Cridland, director-general of the Confederation of British Industry (CBI), said the Government should consider offering businesses £1,500 subsidy to take on poorly qualified teenagers as it tackles the problem of rising youth unemployment.
He said it was important to get youngsters "up the beauty parade" and into jobs, adding a generation could be "scarred" by unemployment if the Government fails to act.
His comments come ahead of Chancellor George Osborne's autumn statement next week, which is seen by many as a mini-budget.
Speaking to Dermot Murnaghan on Sky News, Mr Cridland said: "We need a skilled workforce. We don't want people scarred by unemployment in the early years of their lives.
"Actually, this is as much a moral and social question as it is an economic one. It has really impressed me that at a time when business has got its back to the wall, at a time it could be forgiven for thinking just about paying the wages of those already in work, it is really worried about teenage unemployment.
"Think back to the riots in the summer, think back to what happened in the 1980s, and business is saying 'However tough Government, youth unemployment is something we must not let get out of hand'.
"If we gave employers £1,500 as a cash subsidy to take on a 16-year-old, they might take on a 16-year-old with lack of work experience and sometimes poor qualifications rather than a migrant worker or a mature worker who has got those skills.
"So let's get that young person up the beauty parade, let's give them a chance to get a job today, not in five years' time."
Mr Cridland said he believed the Government should stick to reducing the deficit but there were means of stimulating growth without spending significant sums of public money.
