Similarly, across the developing countries, the World Bank estimates that there are 262m such youths. All told, there are perhaps as many as 290m 15-to-24-year-olds not participating in the labour market— almost a quarter of the world’s youth, and a group almost as large as the population of America. More young people are idle than ever before. Why? Some of these youths choose not to work. About a quarter of the 290m are south Asian women who do not work for cultural reasons. And under-24s who are working are disproportionately engaged in informal or temporary employment.
In the rich world, it is estimated that a third of under-24s are on temporary contracts; in developing countries a fifth are unpaid labourers or work in the informal sector. That is better than not working at all, but is hardly cause for celebration. In total, nearly half of the world’s young are contributing to the labour market less effectively than they could be. This is not simply the result of the financial crisis, though that is part of the explanation, having affected young people in the rich world particularly badly.
Youth unemployment has increased by 30% across the OECD, and in Spain it has doubled to 20% as proportion of the youth population. In the developing world, meanwhile, a second contributory factor is that many countries with fast-growing populations also have inefficient labour markets. Almost half the world’s young people live in South Asia, the Middle East and Africa, the regions with the highest shares of youngsters out of work or working informally. (It is no coincidence that South Africa has some of the strictest rules on hiring and firing and one of the worst youth-unemployment problems in sub-Saharan Africa. A third factor is the growing mismatch between the skills that youngsters have and the vacancies that employers want to fill. Germany, which has a relatively low level of youth unemployment, places a lot of emphasis on high-quality vocational courses, apprenticeships and links with industry. But it is an exception. The effects of youth unemployment can persist for years. Those who begin their careers without work are more likely to have lower wages and suffer joblessness again later in life. The economic loss can be substantial, too, and not just in the form of higher welfare payments.
Part of these losses may be due to missing out on training and experience accumulation that typically occurs with young workers. But younger workers typically change jobs at much higher rates than their older counterparts, and these job switches are responsible for most of a worker’s wage growth early in a career. Workers forced into bad matches or no matches end up on a productivity trajectory well below what they might otherwise have expected. One estimate suggests that the total economic loss from youth unemployment was equivalent to 1. % of GDP in Europe in 2011. Realising this problem, governments are trying to address the mismatch between skills and jobs: apprenticeships in Britain have increased in recent years, for example. There is evidence too that companies are investing more in the young and revamping their training programmes. New technology is providing educational opportunities to people who might otherwise remain outside the job market. There is some cause for hope, then. But the scale of the problem is daunting.
The Essence of the story Of the 290 million 15-to-24-year-olds youngsters not contributing in the labor market, almost a quarter of the world’s youth. * Nearly half of the world’s youngsters are participating to the labor market less effectively as they could be. * A quarter of the 190 million youngsters are south Asian women who do not work for cultural reasons, in the rich world, it is estimated that a third of under-24s are on provisional contracts; in developing countries a fifth are unpaid laborers or work in the informal sector. Youth unemployment has increased by 30% across the OECD. (OECD is an international organization of thirty four countries) * In the developing world a basic factor is that many countries with fast-growing populations also have inefficient labor markets. * One estimate suggests that the total economic loss from youth unemployment was equal to 1. 2% of GDP in Europe in 2011. * Companies are investing more in the young and renew their training programs. This is some cause for hope but the scale of the problem is frightening. Economic Analysis
There is a global youth unemployment crisis. Cultural differences plays a major role in this problem. For example a quarter of the 190 million unemployed youngsters around the world are south Asian women who do not work for cultural reasons. We will now concentrate on the Netherlands where we live in a democratic society and the life circumstances are stable. We are looking for the reasons of youth unemployment in The Netherlands and how we can fight this problem. Over 1,5 million of those aged 16-24 in The Netherlands, one in six is unemployed.
This is the highest level for almost 25 years. Unless action is taken, forecasts indicate that the growing youth unemployment will lead to a new recession in the near future. The high and continued level of youth unemployment will have a dreadful effect on the economy of the Netherlands and result in a ‘lost generation’. Unemployment at the beginning of an individual’s working life often leads to a scarring effect, increasing the chance that they will be unemployed in the future and lowering their lifetime earnings.
The instance for action – economically, socially and fiscally – is therefore clear. Tackling these levels of youth unemployment would be a challenge in any environment but it is particularly difficult in a period when public sector budgets are under pressure. More than ever it will be important to be efficient and effective in reacting to the problem. While important steps have been made in the local and national response, there are still things that can be improved. Youth workers and employers suggests that the approach is still not broad enough as it could be. In particular: Support services are not reaching many young people, One-third of unemployed young people have received no support from public sector agencies. * Young people still need very basic support, such as advice and guidance on careers opportunities, vacancy search, CV writing and interview practice. * Many young people lack a real world appreciation of what qualifications and other personal attributes are necessary to get a job. The differences between young people’s perception and what they can achieve with their qualifications in reality is more than twice as high among young people not in employment, education, or training.
Support services are not working for many employers. Only 25% of employers that had sought support from Government felt that they got sufficient help to employ young people Dealing with the unemployed young people and getting them into work is expensive and therefore just beyond the budgets of local partners alone. Supporting mainstream programmes is essential. Some undemanding examples of what can be done are as follows. * Inviting local employers to speak in schools * Improving work experience. * Teaching young people to build their own support networks. Encouraging young people to plan their own careers, In Finland young people are encouraged to simulate their learning path based on their long-term career goals.