Inquiry launched amid 'crisis of opportunity' as nearly 1 million young people not working or studying
Pat McFadden has called the high figure of 16-24 year olds falling out of education or work a "crisis of opportunity"
The government is to launch an independent review into the rising number of young people not in work or study.
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Former Labour Health Secretary Alan Milburn will lead the inquiry into "Neets" - an acronym referencing those not in education, employment or training.
Work and Pensions Secretary Pat McFadden has said the consistently high figure of 16-24 year olds falling out of education or work is a "crisis of opportunity".
The investigation comes as one in eight young people currently fall into the "Neet" category. The total figure, now approaching one million, has caused Mr McFadden to call for urgent action.
The reasons behind the crisis are multiple. A quarter attribute their issues to a long-term sickness or disability, with the number of those claiming health and disability benefits rising 50% in the past five years, according to the Department of Work and Pensions.
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Around 80% of young people claiming UC Health and Employment Support Allowance currently cite mental health reasons or a neurodevelopmental condition.
When asked about whether this was an over-diagnosis phenomenon, Mr McFadden said that he didn't want "to play amateur doctor", and would rather focus on the best policy response for the situation. He added that he did not think there should be "an automatic link between diagnosis and benefits".
The government says the review will dig into the reasons behind the rise and examine ways of cutting the long-term costs of youth inactivity. It will also focus on getting young people off benefits and into work.
"If we get this right, the prize is huge: transforming lives and life chances, with the pent-up potential of the next generation firing our economy and building a better future for all," said Mr McFadden, originally speaking to The Sunday Times.
"We cannot afford to lose a generation of young people to a life on benefits, with no work prospects and not enough hope."
Milburn said his review would be "uncompromising", and expose any failings in employment support, education, skills, health and welfare.
"We cannot stand by and let a generation of young people be consigned to a life without employment or prospects," he said. "It's clear urgent action is needed."
The conclusions of the inquiry are to be published next summer.