The number of 16 and 17-year-olds working in the summer has halved compared to 20 years ago, the IPPR thinktank found.
There has been a seven per cent drop in the number of 18-24 year olds working while studying over the last decade.
Part-time work alongside education is widely seen by employers as a good way for young people to learn vital skills that help them secure their first part-time job.
Previous research found a quarter of young people without work experience were unemployed but that figure was cut to 14 per cent for those who had spent time in the workplace.
Carys Roberts, research fellow at IPPR, said: “With the aftershock of the Brexit vote looming large on the UK economy, young people will need all the help they can get to get on the employment ladder. Our analysis shows that young people want to work both in the summer and alongside studying, but often can’t.
“Government, business, schools and universities need to work together to create opportunities for young people.
“This should including high quality work experience at school, apprenticeships with qualifications attached and university-brokered paid internships for their students.”
Recent research by JPMorgan Chase suggested this is not just a British trend with the US seeing a 37 per cent fall in teenagers taking summer jobs over the last 20 years.