The announcement to MSPs by Youth Employment Secretary Angela Constance was the Scottish Government's response to the Wood Commission which found that young people were not being equipped for work.
Ms Constance said: "Investing in Scotland's young workforce is key to Scotland's future economic success and tapping into all our talents through a more diverse workforce is not just the right thing to do but makes economic sense."
Labour described the plans as "modest" and called for more money for colleges.
The funding will support regional employer partnerships, designed to encourage businesses to take on more young people, and a careers advisory service.
The Government will address gender segregation and assist young disabled people and minority groups to better access training and employment programmes.