Published on June 9th, 2014 |
by Matthew Deacon
Image © morgueFile 2008
The Unanswerable Question: Why Youth Unemployment Won’t Go Away
Between January and March of this year 19% of all 16-24 year olds in the UK were unemployed, that means that over 868,000 young people across Britain could not find work in the first quarter of this year. Looking across the rest of Europe these figures shoot up with Greece, Spain and Italy all currently recording youth unemployment rates of over 40%. As the global economy slowly recovers from the 2008 crash and the resulting credit crunch youth unemployment is fastly becoming Europe’s largest economic challenge. The failure to engage a new generation of Europeans in the labour market has been described by Germany’s chancellor Angela Merkel as “the most pressing problem facing Europe at the present time.”
In a climate of economic recovery with increasing house prices and reports of economic growth from across Europe what’s gone so wrong for Europe’s unemployed youth and why can’t European governments find a solution?
Early in 2013 European governments and the EU pledged over €8bn in funding to try and alleviate youth unemployment and yet since then unemployment rates have not abated. This money and the schemes it funds, including major programmes such as the EU’s Youth Guarantee scheme, don’t seem to be working. In the UK major programmes such as the governments Youth Contract, which the government has poured £1bn into and which provides temporary wage subsides to employers worth up to £2,275 if they provide a six-month “job start” for under 25s, have seen little or no impact on the overall rate of youth unemployment.
The questions that must be asked then are how and why are such large scale and well supported schemes still failing the young people of Europe?
One answer may lie in the types of education and training schemes that are being offered across Europe, they may well be producing the wrong sorts of workers for Europe’s businesses. In Germany, the nation with Europe’s lowest youth unemployment rates which hovers around 8%, a dual system, a mix of classroom learning and on-the-shop-floor work experience, is encouraged to train young people in both the vocational and academic skills needed for the modern workplace environment. However, in many other European nations, including the UK, a single system made up of either vocational training or classroom learning is favoured. This means that despite participating in educational and training schemes many young people across Europe are still in a position where they are considered under qualified or under experienced for the jobs that are out there.
Another problem any scheme focussed on reducing unemployment during a period of massive economic instability is the lack of jobs that are available for the unemployed to fill. The EU’s Youth Guarantee programme aims to offer all young people training and apprenticeships within four months of them becoming unemployed, it doesn’t, however, guarantee jobs. The slow rate of economic growth across Europe has stilted the creation of new jobs, particularly in areas where new sources of employment are most desperately needed. Put simply if there is no growth, there will be no new jobs and those newly qualified workers will return to the ranks of the unemployed.
With such high levels of youth unemployment affecting many of Europe’s largest economies there is a very serious risk that whatever economic recovery that is achieved will be hampered and undermined by a continuingly high level of youth joblessness. Youth unemployment is extremely costly for the European economy, in the UK in 2012 youth unemployment cost the country £4.8bn, this is in addition to the estimated £10.7bn in lost output for the same year.
This generation is the ‘scarred’ or ‘lost generation’ made up of young men and women who lack qualifications, experience and the know how to survive in the work place environment. By failing to find work these young people face a very difficult future with economists saying that this young generation faces the very real prospect of ending up worse off – materially, professionally and socially – than their parents. Youth unemployment can and will hamper the lives of hundreds of thousands of young Europeans however it has the potential to also derail Europe’s fragile recovery unless something changes.
Youth unemployment is the biggest challenge facing Europe at the present time threatening to block economic advancement, disrupt social cohesion and encourage political turmoil. The only peaceful and prosperous way forward for Europe is by finding an affective answer to the lingering problem of youth unemployment. Maybe the German dual-system holds the answer, maybe not, all that is clear is that youth unemployment must be dealt with before the economic disaster of 2008 can truly be forgotten.
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