More than 250,000 young people are growing up in a home where no-one has ever worked, according to figures published by the Government.
Employment Minister Chris Grayling said the figures were a "ticking time bomb" left by Labour and were on top of 600,000 young people who have never worked since leaving education.
The minister unveiled a programme aimed at giving young people extended work experience opportunities, as part of a drive to tackle the "blight" of youth unemployment.
Under the new scheme, young people will be allowed to do work experience for up to eight weeks so they can get a "meaningful" stint in a business environment, gaining work experience, improving their CV and references and providing value to the employer, said the Government.
Under the old system people were allowed to do only two weeks experience before facing a loss of benefits.
Mr Grayling said: "Our new work experience scheme will give young people the chance to get valuable experience in a business for up to two months, which will make a real difference to their confidence, their employability and their prospects. This Government is making the changes that will give young people access to jobs and opportunities that can help them towards a brighter future.
"Today's figures on children growing up in workless households highlight once again the shocking betrayal of this country's young people by the last Labour government.
"Billions were squandered on the New Deal and Future Jobs Fund which too often merely put the young in short term, public sector jobs that were unsustainable.
"Their failure to get young people into work will cost us dear in the long run, as the next generation have to shoulder the burden not only of the enormous debt left by Labour, but also lack the confidence to reach their potential. We have a big challenge ahead of us, but tackling youth unemployment is crucial for the future of our country and our labour market."