Image caption Chris Grayling said firms could find "hidden gems" among those who seemed unwilling to work

Companies should hire young British people "from a poor background" rather than more experienced foreign workers, the employment minister has said.

An earlier version of Chris Grayling's speech urged them to employ "the surly young man in a hoodie" - but he did not use the phrase in the speech.

He also attacked those who "rail with outrage" at the idea of young people doing unpaid work experience.

Jobs "don't just come on a plate", Mr Grayling added.

He was speaking to the think tank Policy Exchange in London on Wednesday afternoon. It came as official figures showed UK unemployment had registered its first fall since last spring.

'Genuinely feckless'

Mr Grayling said he wanted "British employers [to] put local recruits first".

"It's easy to hire someone from Eastern Europe with five years' experience and many employers choose to do so," he said.

"But those who look closer to home find gems too - turning round the lives of somebody from a poor background, given no real opportunity in life - and end up up with a model employee as a result. So we should give these young people a chance."

Mr Grayling's words differed from those in a copy of the speech circulated in advance.

He had been expected to say: "Very often the surly young man in a hoodie who turns up looking unwilling to work can turn into an excited and motivated employee.

I'm afraid there are too many people who still just don't get it Chris Grayling, Employment Minister

"It's all about the expectations that they have and the place they come from. And employers who give them that chance find it enormously rewarding."

In 2006, Labour accused David Cameron - then leader of the Opposition - of encouraging people to "hug a hoodie" after he gave a speech suggesting hooded tops were "more defensive than offensive", worn to help young people "blend in" not appear threatening.

Mr Grayling also said British firms who moved their customer service departments overseas were "mad", adding: "We all know how frustrating it can be speaking to a call centre operator overseas who works from a set script but doesn't get what your problem is."

He argued that the welfare state must be "a ladder up" for the unemployed, "not a place in which they live", and insisted that "even the genuinely feckless can change".

But in order for the UK to compete with growing economies in Latin America and elsewhere, British workers must show "a willingness to work [their] way up from the bottom".

Benefits docked

Referring to Guardian newspaper columnist Polly Toynbee - who has praised those who protested against the government's work experience scheme - he said: "I'm afraid there are too many people who still just don't get it.

"Like the 'Polly Toynbee Left' who rail with outrage against the idea of a young unemployed person being offered the chance to do a month's work experience with Airbus, British Telecom, UK Mail or Tesco.

"Slave labour they call it. Well, that's just insulting to some great companies who are helping young people get a job, not to mention the young people benefiting from placements by picking up the valuable skills and experience they need to get a leg up into the world of work.

"They just don't understand that in today's world, things don't come on a plate."

Only this prime minister could think it was a cause for celebration that over a million young people are still out of work in this country Ed Miliband, Labour leader

Mr Grayling also attacked union leaders "who demand swingeing taxes on wealth creators and unrealistic pay rises and more protection for their members".

"Don't they realise that in many sectors, companies are a few business class air tickets away from relocation somewhere else where their enterprise and wealth creation is welcomed and not derided?"

The work experience scheme gave 16- to 24-year-olds on jobseeker's allowance the opportunity to do up to eight weeks' unpaid work but keep benefits.

However, it attracted widespread criticism because those who dropped out after the first week risked having their benefits docked for a fortnight.

Several firms, including Burger King, Waterstones and Maplin, pulled out following protests, and eventually ministers agreed to drop the threat of sanctions against participants.

During prime minister's questions on Wednesday, David Cameron welcomed the news that unemployment had fallen over the last quarter.

But Labour leader Ed Miliband said: "Only this prime minister could think it was a cause for celebration that over a million young people are still out of work in this country.

"It's no wonder people think he is out of touch."