Fixing Britain’s youth jobs crisis will require ministers to drastically increase investment in employment support while avoiding arbitrary cuts to benefits, the head of the trade union movement has said.

Before an important official report expected next week, the general secretary of the Trades Union Congress , Paul Nowak, said the government had a “once in a generation chance” to secure young people’s futures.

In an interview with the Guardian before the highly anticipated Milburn review into young people and work, he said the costs of increasing job support, education and training would be outweighed by economic gains that would help to ease the pressure on the welfare state.

“There is no solution that is cost-free,” he said. “The government is going to have to be prepared to invest in securing the future of those young people, but also to invest to secure what is the future of our economy.

“This is where the government is going to have to be clear.…