The gulf between the earnings of younger and older people has increased by 50% in the last 20 years, leaving young workers struggling to survive, the TUC has warned in a report.

In a bid to combat the growing generational pay gap and halt falling union membership among younger people, the TUC said it was revolutionising the way it recruits younger workers.

This week – which marks the 150th anniversary of the first Trades Union Congress in Manchester – the organisation will pilot a new digital service. The WorkSmart app will provide younger workers with information about their rights and career progression, and will encourage them to come together across sectors to fight low pay, insecure contracts and employer abuses.

“We’re creating a lost generation of younger workers. Too many young people are stuck in low-paid, insecure jobs, with little opportunity to get on in life,” said Frances O’Grady, general secretary of the TUC. “But unions need to reach out to the young workers in workplaces where there isn’t a union. WorkSmart is a new way to get the benefits of trade unions to the young workers who need us most.”

The TUC report Stuck at the start: young people’s experience of pay and progression reveals that the pay gap between over- and under-30s has grown from 14.5% in 1998 to 21.9% in 2017 – meaning that younger workers get on average £2.81 per hour less than their older colleagues.

The number of 21- to 30-year-olds working in precarious, often low-paid work has exploded, according to the report. In that 20-year period, numbers of young people working in private social care has increased by 104%, while in hotels and restaurants the figure is 80%. The generational pay gap has increased in real terms from £3,140 in 1998 to £5,884 in 2017 for someone working a 40-hour week.

A YouGov poll of 1,500 young people carried out for the report found that only three in 10 felt their current job made the most of their experience and qualifications; four in 10 had been given little or no training in the last 12 months while one in five had worked on a zero-hours contract in the last five years.

Echoing a recent report by thinktank the Resolution Foundation, which warned of a breakdown of the generational contract, the study found that a quarter of young workers had struggled to earn enough to pay basic living costs, while one in five had skipped a meal to make ends meet. A lack of wage growth also had longer term implications for society, it warned: 22% of younger workers had put off starting a family and 41% had put off buying or moving home.

The TUC has been working with its member unions – which together make up more than 5.5 million workers – to develop the new digital offering to tackle increasing generational inequality for two years. It aims to “develop a model of trade unionism better-suited to a new generation of workers”, said the TUC.

Around 1,000 young workers have already signed up, with the developed app expected to be rolled out next year.

“For a lot of young people their experience is that the world of work is by its nature insecure. That not being paid properly is normal and they are supposed to be just grateful,” said O’Grady.

“The decline in collective bargaining has had huge impact ... but the whole point of trade unions is we are about raising expectations and saying you deserve to have a job that gives you enough to live on. We are failing young people if they don’t see us as a route to achieving that.”