Cllr Simon Phipps, Dudley cabinet member for economy and infrastructure, approved collecting up to £352,600 from a pot of cash provided by the West Midlands Combined Authority (WMCA).
If the decision is rubber-stamped at a meeting on June 9, the cash will be spent as part of the Connect to Work initiative.
Cllr Phipps said: “Getting the best value out of these grants will be really important for local people in Dudley borough.
“This funding will help a group of people who face significant barriers to getting into regular work, particularly young people with complex health conditions or disabilities.
“The more people we can help into work with this program the better.
“We know that people who are working often have a far better quality of life for themselves and their loved ones.
“This also helps contribute towards a better Dudley borough overall, with greater economic prosperity and residents enjoying happier lives.”
The council will spend the money over three years and initially plans to support 50 individuals, either to fund work or who are already working.
Places will be secured by the WMCA and delivered by the council which will monitor progress of young people, aged 18 to 29, who are taking part in the scheme.
The WMCA is working with seven local councils, including Dudley, on Connect to Work.
Across the West Midlands, where youth unemployment is more than double the national average, there are 27,265 young people in receipt of Universal Credit, of which 12,660 have health conditions.
West Midlands mayor, Richard Parker, said: “Every person in our region should have the same access to work opportunities – including people with disabilities or long-term health conditions.
“By having the same access to opportunities, everyone has the freedom to make the right choices for them – to help them earn, live independently and improve their health and wellbeing.”
