Youth (un)employment: a European perspective

The persistently high level of youth unemployment in the UK has been well trailed in the press, and in the CIPD’s own policy blog. Even though we have begun to witness a welcome fall in the youth unemployment rate, there are still 700,000 16-24 year-olds who are out of work in this country. But what does the wider picture of youth unemployment and inactivity look like across Europe? And what is the strategy in Brussels for improving the employment prospects for young people in the EU28 member states?

Mind the gap
A glance at the latest figures supplied by Eurostat (the statistical office of the European Union) explains why reducing youth unemployment across EU member countries is a high priority for the Brussels policy-making machinery. As at August 2014, around five million young people (under 25) were unemployed in the EU28, equivalent to a 21.6% youth unemployment rate. Eurostat notes that youth unemployment rates are generally much higher, ‘even double or more than double than the unemployment rate for all ages.’

The UK youth unemployment rate is too high, but the proportion of young people out of work in some EU countries is startling. ‘Mapping youth transitions in Europe', a report released in July 2014 by the European Foundation for the Improvement of Living and Working Conditions in Europe (Eurofound) charts the large variation in youth unemployment rates between EU member states. These range from 7.7% in Germany and 9.7% in Austria compared to 55.3% in Spain and 58.3% in Greece – amounting to a gap of more than 50 percentage points between the lowest and highest rate of youth unemployment between member states. The wildly divergent rates across the EU emphasise the diverse nature of youth unemployment and the different national solutions necessary to combat it. For example, while there are common issues around why transitions from education to work are more difficult for young people, there are also country-specific issues, such as the challenging economic situation in Spain whereas in the UK one of the main challenges relates to employer behaviour towards young people.               

EU action
There is no doubt that Brussels is intent on boosting the employment level of young people and the key policy-making bodies such as the European Commission have implemented a number of EU-wide programmes in this area. Its flagship initiative is ‘Youth on the Move', a package of policies as part of the Europe 2020 strategy. Youth on the Move aims to improve young people’s education and employability by:
• making education and training more relevant to young people's needs;
• encouraging more of them to take advantage of EU grants to study or train in another country; and
• encouraging EU countries to take measures simplifying the transition from education to work.

Adopted in 2013, the Youth Guarantee is a key EU scheme to tackle youth unemployment and social exclusion. The European Commission wants every member state to introduce a Youth Guarantee scheme to ensure that all young people up to the age of 25 receive a good quality offer of employment or continued education or an apprenticeship or traineeship within four months of leaving formal education or becoming unemployed. In its recent memo, the Commission describes the Youth Guarantee as ‘both a structural reform to drastically improve school-to-work transitions and a measure to immediately support jobs for young people.’ It says that the scheme is based on successful experience in Austria and Finland, with the Finnish Youth Guarantee resulting in 83.5% of participants successfully allocated a job, traineeship, apprenticeship or further education within three months of registering. The EU has also made available, under the European Youth Initiative, €6 billion (including €206 million to the UK) in funds to support member states’ efforts to ease the transition from education to work and improve youth employment. Incidentally, the UK is one of the very few member states to choose not to implement the Youth Guarantee although it supports the scheme’s aims and is involved in pilot projects for it.

Early progress...
The majority of member states have submitted ‘Youth Guarantee Implementation Plans’ to identify the national measures to be taken in each member state, including the timeframe for youth employment reforms, the respective roles of public authorities and other organisations, and how it will be financed and co-financed by the European Social Fund and the European Youth Initiative. In its memo, the Commission says there are already good examples of ‘concrete and positive results’ from implementing the Youth Guarantee – such as The Belgium Youth Guarantee leading to a drop in the number of under-25s looking for work in Brussels. Spain’s scheme includes training contracts for young people and four free online training courses available to everyone registered with the scheme.

There are also 18 small-scale pilot projects for the Youth Guarantee, launched between August and December 2013 in seven countries (Ireland, Italy, Lithuania, Poland, Romania, Spain and the UK). These include three pilot projects in the UK, in Croydon, Hartlepool and Pembrokeshire. The pilot schemes mainly comprise targeted measures offering services to at-risk groups – some focus on promoting self-employment among unemployed youth, for example, while others help them to prepare and apply for jobs. All provide a mix of both long-term structural reform measures and short-term ‘relief’ policies aimed at helping young people into employment, training or education. The UK Croydon project offers new or extended traineeship opportunities for students in their final year of education, for example, while the public/private partnership in Hartlepool aims to encourage the creation of apprenticeships in local companies.

...but more work to be done
The Commission says in its memo that the implementation of the Youth Guarantee is ‘well on track and already bringing results.’ However, in the European Parliament’s plenary debate on 17 September, many MEPs raised concerns about effective implementation of the European Youth Initiative and urged EU countries to make better use of the €6 billion available for the scheme. MEPs encouraged EU member states to use the available EU funds to ease the transition from education to jobs for young people and foster entrepreneurship. Some MEPs advocated approaches such as sharing best practice and promoting apprenticeships. As all of the money allocated under the scheme is frontloaded and committed in 2014 and 2015, there is some urgency for more concerted EU-wide action to reduce the 21.6% youth unemployment rate across member states.

In the UK, as well as lobbying Government for effective structural changes to improve youth employment, the CIPD is working hard through its Learning to Work programme to improve transitions from education to employment. We are also keen to develop good practice on an EU-level platform – there may not be a one-size-fits-all solution to improving youth employment across member states, but there are definite lessons that can be learnt and experiences that can be shared between countries.

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