Wage subsidies for firms hiring out of work 18 to 24-year-olds are to be triggered early in 20 deprived areas.
Deputy Prime Minister Nick Clegg has announced that payments will be paid when young people have been out of work for six months instead of nine.
The initiative is part of the government’s £1bn Youth Contract which was announced in November to tackle record youth unemployment.
It is hoped the cash will create around 400,000 work and training placements.
The subsidy, of £2,275, would cover six months of employment and is equivalent to half the UK’s youth minimum wage paid by firms.