The Swedish labour market functions well for core workers, but the inclusion of youth could be improved. The unemployment rate for youth is four times higher than for prime-age adults, reflecting both deficiencies of the education system and some specific features of the Swedish labour market. Learning outcomes in compulsory schooling are above-average in reading, but not in mathematics and science. In secondary school, the programme structure is fragmented, and youth completing a vocational programme appear to lack important skills: they are not “job ready”. This is problematic in the context of a labour market characterised by high minimum wages, set in collective agreements, and stringent employment protection rules: those with low productivity have little chance to find a job, and employers are cautious about hiring youth whose skills are often hard to assess, in particular youth with an immigrant background. This chapter reviews recent proposals for education reform. It also examines how recent tax and benefit changes might be supplemented to ensure that job-search is genuinely attractive without deterring youth from entering and completing further studies early on.