B Explanatory
memorandum by Ms Pejčinović-Burić, rapporteur
1 Introduction
1. The revised European Social Charter
Note (Part I, paragraph 1) states
that “everyone shall have the opportunity to earn his living in
an occupation freely entered upon”. Article 1 of the same treaty
recognises the right to work and underscores the responsibility
of the contracting parties in the achievement and maintenance of
a high and stable level of employment, with a view to attaining
full employment. Accordingly, the Council of Europe member states
must seek to protect effectively the socio-economic rights of their
population and thus aim to provide free employment services for
all workers as well as appropriate vocational guidance, training and
rehabilitation.
2. Today’s world population includes 1.2 billion young people
aged between the ages of 15 and 24. This group represents a significant
part of the world’s total workforce (24.7%). However, unemployment
in this same age group accounts for 43.7% of the world’s total unemployed
population.
Note In
the 27 countries of the European Union alone, youth unemployment
is twice as high as for the rest of the working-age population (20.9%
against 9.6% in 2010) and grew throughout 2010. The situation is
similar across non-European Union countries of central and eastern
Europe, where one in every five economically active young people
was unemployed in 2010.
Note The
Council of Europe must address the issue of youth employment and
propose ways to remedy the disproportionate levels of unemployment
experienced by young people.
2 The impact
of globalisation
2.1 The increasing
dynamism of emerging countries and its consequences for Europe
3. The different changes affecting the global economy
are not without impact in Europe. In fact, globalisation is a phenomenon
full of paradoxes which reduces global poverty in some areas and
at the same time creates new disparities. Globalisation has highlighted
Europe’s lack of competitiveness when compared with the dynamism
of emerging economies.
4. Emerging economies attract more business because of the lower
costs and vast opportunities for development they can offer. They
boost their trade through the use of modern information and communication technology
(ICT), global transport networks and a highly flexible workforce.
The global trend also shows that growth in emerging economies is
much higher than in developed countries. In addition, many emerging economies
have gained experience in high technologies and now represent a
major challenge for European industry. Europe is less competitive
than before and it is more difficult for European economies to stand
out from the crowd. Economic success for European companies depends
increasingly on differentiation strategies (quality of the products)
since European social systems make it difficult to reduce productions
costs.
5. It is clear that globalisation has had an impact on the European
labour market. A smaller workforce is required because European
businesses have no choice but to specialise in activities that require
more capital and skills than basic manpower. Consequently, most
European economies are increasingly looking for highly qualified
employees in order to remain competitive. In this context, the youth
workforce could be a huge advantage in rising to the challenge of
competitiveness and this is one of the reasons why the burning issue
of youth unemployment must be tackled.
2.2 How the need for
competitiveness impacts on European youth on the labour market
6. The need to be competitive has obliged European companies
to make choices and, in order to survive in the global economy,
few options exist. The differentiation strategy implies making products
competitive in some way (for instance, by emphasising quality, innovation
and the high added-value of products or by exploiting niche opportunities).
At the same time, policies to lower prices by reducing production
costs can also be considered as achieving the same goal.
7. To achieve the first objective, companies have to invest in
research and development and benefit as much as possible from innovative
ideas. In this context, highly-skilled workers are needed to maximise
the chances of success. What is important here is not only to be
a graduate, but also to have the qualifications needed in the labour
market. European education systems are not always adapted to the
specific needs of labour markets. Furthermore, pursuing the objective
of better qualified workers may reduce the job opportunities for
low-skilled workers as, in most cases, this strategy goes hand in
hand with a greater use of capital at the expense of manpower.
8. If companies aim to reduce production costs, different options
can be chosen, either through improving productivity by embracing
more flexibility and efficiency or through cutting wage bills. In
each case, labour market regulations may be a major obstacle. The
less regulation there is, the easier it is to be flexible and the lower
costs will be. Nevertheless, demands for ever-increasing flexibility,
mobility and the simplification of labour laws are sure to have
negative effects on working conditions and stability.
9. All of these actions are prejudicial for youth employment
but the negative impacts vary depending on the decisions taken by
businesses and policymakers. Indeed, these decisions impact either
on youth working conditions or on their opportunities for finding
employment after leaving school. In addition, a distinction must be
made between low- and highly-skilled young workers: while some may
benefit from specific policies, others may be penalised. When chances
to find an official job diminish, the likelihood increases that
some young people will slide into the underground economy with undeclared
jobs.
10. The “Insider-outsider theory of employment and unemployment”
Note may be considered relevant to this report.
The theory holds that a labour market is segmented between people
who are already integrated in companies and others who want to obtain
jobs. The main explanation for this is the high costs incurred by companies
in integrating newcomers: companies prefer to increase the salaries
of their existing employees (insiders) rather than hiring new employees
(outsiders) since this is often the least expensive option.
11. There are various explanations as to why youth unemployment
is higher than the global rate and why young people are the first
victims in a crisis. We have to take into account the fact that
young people who want to enter the labour market have to confront
the inherent barriers of this sector. The lack of experience and
the high cost of training/education is always a handicap for young
people, even if they are qualified and have recently finished their
studies.
12. Statistics of the Organisation for Economic Co-operation and
Development (OECD) show that France, Germany, Poland, Slovenia,
Spain and Sweden are among the countries with a relatively high
percentage of temporary employees. On the contrary, the same statistics
show that Denmark, Estonia, Hungary, the Slovak Republic and the
United Kingdom have a lower percentage. The extensive use of temporary
contracts is one of the reasons why youth unemployment in some continental
European countries and transition economies of central Europe is
more sensitive to the business cycle.
Note
3 The worrying s&tuation
of youth unemployment
3.1 Unemployment is
increasing, especially for young people
13. According to Eurostat, the Youth Unemployment Rate
is “the percentage of the unemployed in the age group 15 to 24 years
old compared to the total labour force (both employed and unemployed)
in that age group”. This age group represents 10% (in Italy for
example) to 17% (in Turkey) of the total population in Europe.
Note Eurostat’s
studies highlight the fact that youth unemployment rates are much
higher than the rates for the total population. However, these figures
need to be read with caution since many young people may not be
on the labour market (studying or not looking for a job), thus affecting
the accuracy of the unemployment rates. The data nevertheless indicates
that young people face specific difficulties in finding jobs. Youth unemployment
in the OECD area now affects approximately 15 million people and
represents almost 19% of the young workforce. In the European Union
countries, youth unemployment has risen in the last three years, from
14.9% in early 2008 to 20.9% at the end of 2010. This percentage
varies significantly in different countries, reaching 42% in Spain,
35% in Latvia and Lithuania, and 34% in Slovakia, for example (see
also the table in the appendix).
Note
14. The sharp decline in youth employment is not a new issue and
has plagued European countries for several years, as testified by
the many articles and reports written and the many measures taken
during the last decade. Nevertheless, the rapporteur underlines
the fact that improvements in public employment policies have not
yet solved this problem. More effective remedies are still required.
15. Moreover, the current economic crisis and the corresponding
decrease in economic activity is negatively affecting the labour
market in European countries and has had a devastating impact on
unemployment rates and job creation all around the world. The situation
for young people is worse than for other sectors of the population
as labour markets are unable to absorb the growth of the young workforce.
The main causes of the problem and the explanation as to why young
people are more affected by the crisis than other sectors of the working
population need to be analysed before proposing solutions.
16. One explanation for the impact of the crisis on youth employment
is the extensive use of temporary contracts. According to various
estimates across Europe, on average 40% of young workers – over
60% in some countries, for example Poland, Slovenia and Spain –
were on such contracts in 2007 compared to about 18% for the rest
of the workforce. Such a situation is only partly explained by the
fact that some young people seek temporary employment whilst studying;
a majority of young Europeans are in temporary employment because
they cannot find a permanent job. Temporary contracts make it easy
for companies to lay off employees during economic downturns, thus
further increasing the likelihood of young people losing their jobs during
such periods. Young workers are often the last to be hired and the
first to be fired. This is known as the “last-in first-out” rule,
which shows that, in times of crisis, most companies wish to avoid
high training costs so prefer to do without inexperienced workers.
Therefore, if companies decide not to renew contracts and stop employing,
newcomers to the labour market are the first sector of the working
population to be affected.
17. Another factor that contributes to explaining the major downturn
in youth employment is that young people are often employed in cyclically
sensitive industries, for example construction. In France, the crisis
has particularly affected young men, many of them low-qualified
workers employed in such industries. Consequently, since the third
quarter of 2008,
Note and for the first
time in France, the unemployment rate of young men has been higher
than that of young women. A similar trend has also been observed
in other European countries.
18. In times of economic crisis, the number of early retirements
decreases. Moreover, the retirement age has been raised across Europe
in the last few years taking into account demographic trends. The
consequence for young people is fewer job vacancies, which again
contributes to the rise in the youth unemployment rate.
OECD statistics show that the percentage
of 55- to 64-year-olds working has increased significantly in the last
two years.
Note The employment
of 55- to 64-year-olds in member states of the Council of Europe
Note followed the same trend,
increasing by an average of 10% during the same period. An explanation
for this trend may be that older employees wish to stay in their
jobs longer in order to improve their financial situation for the
future. In some countries, life savings have been devastated by
the impact of the crisis, leaving many employees determined to rebuild
their savings with a few more years of work.
3.2 Different groups
of young people
19. Certain groups of young people are more at risk of
losing contact with the labour market than others. OECD studies
have identified four youth employment groups: high performers, poorly
integrated new entrants, youth left behind, and returning to education.
“High performers” are employed most of the time and take less than
six months to find a job after leaving school. The “returning to
education” group concerns young people who have decided to complete
their secondary education or who enter tertiary education following
a dissatisfying experience on the labour market. The “youth left
behind” group comprises young people who lack recognised qualifications,
come from an immigrant/minority background and/or live in disadvantaged/rural/remote
areas. This group refers to those who are neither in employment
nor education or training (“NEETs”). The “poorly integrated new
entrants” often have qualifications but experience difficulties
in finding stable employment, even in times of economic growth.
They move from periods of employment on temporary contracts to periods
of unemployment or inactivity.
Note
20. The “poorly integrated new entrants” and members of the “youth
left behind” group face a high risk of losing contact with the labour
market. Both of these groups can be found in all OECD countries,
but the latter is particularly large in countries such as France,
Greece, Italy, Japan and Spain. Young people in this group should
receive state assistance in seeking employment after leaving school.
One strategy could be to offer them the possibility of participating
in programmes to obtain a recognised qualification or diploma. In
the case of “poorly-integrated new entrants”, governments must also
ensure that the young people in this group rapidly find stable jobs
that offer better prospects for career progression.
21. The rapporteur would like to point out that general employment
trends may also affect young people. Inequalities between men and
women, for example, seem to penalise young women too. Only one factor
is favourable to women: they are generally less represented in cyclically
sensitive industries, and consequently are less affected by economic
downturns. However, in the future, young women may be more affected
as the sectors where they are more often employed (the public sector,
health, education, social services, etc.) will be hit by budget
austerity measures in many European countries.
22. By the same token, handicapped people are regularly victims
of discrimination on the labour market and the issue of the employment
of handicapped young people must be specifically taken into account.
23. The earlier problems are tackled, the fewer problems remain
later. Also, with regard to already existing problems of discrimination,
more effective measures should be taken to deal with the root causes,
and to limit their possible consequences on the whole population.
Moreover, European countries must adapt their policies to improve
their specific support to the more vulnerable groups.
4 Structural problems
linked to education systems
4.1 Impact of educational
achievements on youth employment
24. In general, there is a strong correlation between
employment rates and levels of education: the higher the educational
achievements, the higher the probability of avoiding unemployment.
In most economic sectors, between 20% and 40% of young workers are
also in formal education. In European Union countries, half of young
workers are employed in elementary or low-skilled jobs; this proportion
shrinks to about 35% in the next age group as more young jobseekers
possess a diploma and higher qualifications. According to OECD statistics,
Italy is the only OECD country where the proportion of young people
aged 15 to 29 leaving education with an upper secondary education
qualification is higher than that of those with a tertiary diploma.
Note The benefits
of having a good level of education also depend on the economic
characteristics of each country since the skills required by the
labour market can vary from economy to economy. Nevertheless, there
is still a relative advantage to being a graduate with a higher
education diploma on the labour market.
25. From an employer’s point of view, especially in the context
of globalisation, “a well-trained human capital, capable not only
of adapting to and using new technology but also of pushing forward
technological frontiers, is crucial”.
Note Employers are reluctant
to hire “young workers with unmatched skills”
Note due
to the costs involved in training and adaptation in the work place.
This relates directly to the “Insider-outsider theory of employment and
unemployment” described in chapter 2.2. This theory can help to
explain some of the difficulties experienced by young people on
the labour market, especially for the less well educated who have
no educational advantages in comparison with the “insiders”.
26. One of the major problems underlined by official reports on
youth unemployment is the issue of school dropouts. It seems that
if too many young people leave school early (with lower secondary
education), countries face an increased risk of long-term unemployment.
In Spain for instance, “one in four youths leave school with less
than upper secondary education which is regarded as the minimum
level of basic skills to integrate in today’s labour market”.
Note Even if the situation is better in
other OECD countries, the issue of school dropouts must be tackled
as a priority in fighting the potential social exclusion of youth.
This issue also relates to the increasing rate of “Neither in Employment
nor in Education or Training” (NEET) among young people because
the probability of becoming “NEET” is higher when young people leave
school too early without any educational qualifications. These young
people present a “high risk of poor labour market outcomes and social exclusion”.
Note On average, in 2007 they
represented 11% of 15- to 24-year-olds in OECD member countries,
Note about
15% in the EU-27 (but about 36% in Malta and Portugal), 28% in Iceland
and nearly 48% in Turkey. With a few exceptions, young men are more
numerous among early school-leavers than young women.
27. The level of education is also a determining factor in accessing
stable jobs and long-term employment contracts. There is no denying
that most jobs obtained by young people are temporary, but these
contracts do not have the same consequences on future career development
depending on the level of education. It is not rational to condemn
fixed-term contracts as it has been shown that they may be a “stepping
stone to a permanent contract [instead of] a dead end”.
Note Nevertheless,
the probability of obtaining a permanent job after a fixed-term
contract or even after a period of unemployment is always greater
for highly skilled young people.
4.2 The transition
from school to work
28. The transition from school to work refers to the
time taken by young people to find a job after their studies. This
time varies from country to country and some young people are more
exposed to difficulties during their school-to-work transition.
Moreover, “many youth move in and out of the labour market before
finding a job that offers them career prospects and some stability”.
Note Only
a
few young people get into
the labour market directly after having left school. Two youth groups
experience particular difficulties on the job market: the “youth left-behind”
and the “poorly-integrated new entrants”. The first group requires
specific assistance to avoid the trap of long-term unemployment
and inactivity. As they tend to accumulate disadvantages, it should
be possible to detect them before their situation becomes irremediable.
The second group is more concerned by an unstable professional life,
alternating between employment on temporary contracts and periods
of unemployment. In the rapporteur’s view, the transition from school
to work presents particular difficulties for these two groups of
young people and this situation needs to be addressed.
29. First of all, the school-to-work transition should be improved
in order to limit the long-term
unemployment related to the increasing NEET proportion among youth.
Young people in difficulty need help either to rapidly find a job
or to integrate a training programme. Secondly, a solution must
be found to ensure that temporary jobs become a real stepping stone
to “more stable and promising jobs”.
Note These
goals have to be pursued as European countries seek to solve the
problem of the “youth left-behind” and the issue of precarious contracts that
increase the risk of unemployment in economic downturns.
30. According to OECD studies, school-to-work transitions are
smoother in a less reglemented labour market because the instability
due to temporary contracts for new entrants appears to be compensated
by the flexibility of the labour market. In addition, the transition
tends to be easier and quicker for young people who have at least
an upper secondary qualification. Lastly, young people in countries
where apprenticeshipprogrammes
and dual systems of education are well developed experience fewer
difficulties in the school-to-work transition. Nevertheless, the
rapporteur is convinced that each situation can be improved and
considers the issue of school-to-work transition as one of the most
important problems to be tackled by the member states.
5 Consequences of
youth unemployment
5.1 The consequences
for young people
31. More than one third of young people in the world
are unemployed, have completely given up looking for a job (discouraged)
or are working but still living below the $2-a-day poverty line
(the working poor). There are an estimated 152 million young “working
poor” living in extreme poverty with less than US$1.25 a day, which in
2008 corresponded to 28% of employed young people.
Note The International
Labour Organization's (ILO) report on global employment trends for
youth in 2010 points out that 81 million out of 620 million economically active
young people were unemployed at the end of 2009 – the highest ever
recorded number. The prospects for 2010 were no better.
32. One of the major consequences of unemployment for young people
is the negative impact on their professional prospects. This impact
has been termed the “scarring” effect due to the fact that the mere experience
of unemployment will increase the risk of future unemployment and/or
reduce future earnings. The longer the period of unemployment, the
greater the risk of “path dependence” (future long-term unemployment, low
employment opportunities and proportionally lower wages). Long periods
of unemployment also tend to lead to increased levels of future
job dissatisfaction and ill health. For most young people, the effects
of early unemployment on subsequent job prospects have been proved
to be temporary. However, for disadvantaged young people lacking
basic education, a failure in their first experience on the labour
market is often difficult to make up and may expose them to long-lasting
“scarring” effects.
Note
33. The rapporteur wishes to underline the psychological consequences
that may affect young people who are excluded from the labour market
for a certain time. In our European society, social recognition
is closely related to professional status and sociologists have
shown that unemployment, through low incomes and the lowering of
social status, can lead to social exclusion or marginalisation.
For this reason, periods of unemployment can have highly negative
consequences on young people who have never had the chance to prove
that they are good enough to work. Their self-confidence may suffer
in that they feel useless or unable to work.
5.2 The consequences
for society in general
34. The rapporteur is aware that the situation of over-indebtedness
in Europe has led to lower levels of public spending. Nevertheless,
one should not forget that youth unemployment is a problem that
will penalise society as a whole in the future if nothing is done
now. A major challenge for public authorities is therefore to ensure coherent
action that takes into account current constraints on short- to
medium-term public spending, structural trends in the labour market
and the overarching long-term public interest. Considering the global
trends and evolutions in Europe, youth unemployment is a structural
problem and is not simply a consequence of the current economic
crisis. In order to improve living conditions in Europe, the rise
in youth unemployment has to be tackled without delay.
35. First of all, high unemployment creates an important shortfall
for European economies, as it implies a drop in demand and investment
spending
Note whilst low unemployment
stimulates consumption and investment, that is to say economic growth
and higher tax revenue in most cases. Fighting unemployment should
be related to the fight against poverty and precarious situations.
Both are unfavourable to European economies, especially in times
of crisis when an upturn of economy is the first priority.
36. The current situation of youth unemployment threatens to marginalise
many young people whose future employment opportunities may dry
up as a result of a structural change in the labour market. The
erosion in a working generation involves the risk of compromising
not only individuals’ future plans and expectations but also their
contribution to the economy, democracy and a country’s return on
its social investment.
37. Another consequence which could affect countries with high
rates of youth unemployment is that young people may decide to move
to other countries which offer them a brighter professional future.
This type of migration can result in a country’s loss of productivity
and the loss of its young workforce (both non-qualified and highly
skilled). This in turn would negatively affect its future economic
development. By helping young people to access employment and to
find their first jobs, states would attenuate social tensions in
their societies and would diminish the reliance of certain economic
sectors on immigrant labour.
38. In addition, the European demographical situation and the
set-up of social welfare systems in most countries requires young
people to work in order to finance pensions. In the context of population
aging trends, European countries have to prepare the future: the
young generation represents an opportunity to make intergenerational
solidarity and national development sustainable. As the baby boomers
retire, European economies need more young people to work.
Note This
situation should naturally help to reduce youth unemployment, but
governmental action is still required to ensure that young people
have better qualifications and accede to satisfying job opportunities.
39. One possible and highly worrying consequence of youth unemployment
is the increase of violenceor delinquency
among young people due to the lack of opportunities offered by the
labour market. This may in turn increase social costs. The issue
could be included in a wider discussion about the unequal opportunities that
have recently provoked violent reactions in some European countries
and Europe’s Mediterranean neighbourhood where populations are eager
to reclaim their fundamental rights of living and working in dignity.
6 Solutions
6.1 Measures to improve
youth employment prospects
40. All the social costs of youth unemployment must be
taken into account and governments must find ways to minimise if
not eliminate them. The European institutions, including the European
Union and the Council of Europe, can and should do more to help
their member states offer more and better jobs for the young generation.
Other partners, such as the European Bank for Reconstruction and
Development, the Council of Europe Development Bank, the North-South
Centre, the European Social Fund (ESF) and the European Investment
Bank, could usefully supplement both European and national action
programmes.
41. The ESF is in fact the main European Union financial instrument
for supporting youth employment, entrepreneurship and the learning
mobility of young workers, as well as action to prevent young people
from dropping out of school and raise skill levels. About a third
of the 10 million ESF beneficiaries supported each year are young
people. Moreover, about 60% of the entire ESF budget (€75 billion
for 2007-2013) is combined with national co-financing in favour
of young people.
Note We
should also note that in September 2010 the European Commission
launched a public consultation on future education and learning
programmes with a view to presenting new proposals in 2011, in time
for the next programming period of the ESF. The rapporteur encourages
all those interested in the ESF-supported projects for youth and
employment in the European Union member states to visit the Fund’s
website.
Note
42. The Council of Europe member states have formulated their
strategic proposals on youth employment in the declaration adopted
at the 8th Conference of Ministers responsible for Youth (October
2008), in parallel with the European Union’s “Council Resolution
on a renewed framework for European co-operation in the youth field
(2010-2018)” and the “EU 2020” economic strategy, including the
“Youth on the Move” flagship initiative. Your rapporteur notes that
an existing joint programme between the Council of Europe and the
European Union on “Youth Partnership Framework Programme 2010-2013”
aims, amongst others, at the social inclusion of young people through
access to rights and the creation of opportunities in employment,
education and training. Within that framework, more synergies could
be sought in the work of the Council of Europe’s Youth Centre and
the European Social Fund towards concrete projects to underpin youth
employment.
43. As the wind of democratic change is blowing across the southern
Mediterranean, the “old” democracies of Europe cannot stand and
watch idly. In the context of a wider discussion on the Council
of Europe Neighbourhood policy, this Organisation could consider
better exploiting the potential of its North-South Centre for joint
projects in favour of youth, employment and human development in
southern Mediterranean countries.
44. The private sector plays a major role in fostering both youth
employment in particular and job creation in general. To this effect,
companies have to be encouraged by governments to hire young low-skilled
workers on apprenticeship contracts which allow them to combine
their studies with a first experience in the labour market. Apprenticeships
also provide low-skilled workers with an opportunity to obtain the
necessary skills to advance in their future profession and gain
enough experience to become an asset to their company. Moreover,
they are an excellent way of adapting the skills obtained by apprentices
to the skills demanded by the labour market. To carry out apprenticeship
training, companies need to have access to training and management
assistance, particularly for apprentices without any qualification.
45. The evidence has shown that a dual system, alternating study
and apprenticeship training or other vocational education programmes
is an effective pathway to enter the labour market and thus smooth
the transition from school to work. It has also been proved that
countries with strong apprenticeship systems have a greater proportion
of high performers. The dual system is used by countries such as
Germany and Austria as a complement to a regulated labour market.
Youth unemployment rates in Germany and Austria are among the lowest
in Europe due to a successful apprenticeship system that ensures
a relatively smooth transition from school-to-work for most young
people.
46. Even if some experts are convinced that the key to the problem
is the removal of labour market rigidities that penalise youth employment,
many argue that even highly regulated labour markets perform well
when strong vocational education and training systems are in place.
Indeed, there is no need toderegulate
labour markets as long as countries are able to run efficient educational
systems. Furthermore, we should consider that the more flexible
the market is, the more precarious the jobs held by young people
will be. Considering the high levels of cyclical youth unemployment
in some countries, such as Spain, the development of temporary contracts
for young people should be avoided in order to reduce the risk of
lay-offs during economical downturns.
47. The establishment of an efficient apprenticeship system benefits
both companies and young employees. This approach requires adequate
state support and programming. The rapporteur considers that governments should
promote this avenue by providing – though local, regional or central
authorities – subsidies or tax incentives to companies, in particular
small and medium-sized enterprises (SMEs) and start-ups. Targeted support
measures to prevent apprentices from being made redundant before
they complete their training could also be helpful. Governments
could also financially encourage companies to hire their apprentices
on a more long-term basis at the end of the apprenticeship. However,
in some countries where the apprenticeship system is well established,
companies have become reluctant to offer this kind of contract,
particularly to young people lacking educational qualifications
or from an immigrant background. To counter this situation the rapporteur considers
that fiscal benefits should be given preferably to companies hiring
unskilled apprentices.
48. It should be noted that apprenticeship contracts can turn
into a negative practice when companies misuse them. A persistent
aim of lowering labour costs could lead companies to take advantage
of apprentices’ low wages and make profits out of the extra output
provided by their work. The misuse of these contracts can result
in a precarious situation among apprentices where, instead of being
trained, apprentices are asked to do the same jobs as ordinary employees
but do not receive adequate remuneration. Therefore, governments should
ensure that minimum wages are paid to apprentices and should protect
them from possible abuses. International and national laws could
limit the extension of apprenticeship contracts when the worker
exceeds a certain age. Moreover, subsidies given should be designed
to minimise possible deadweight or substitution effects and they
should only be given in relation to youth without skills or laid-off
apprentices in order for them to complete their qualifications.
49. Concerning other possible improvements that could smooth the
school-to-work transition, OECD experts advise several measures.
They recommend that European countries should “provide early guidance
to school-leavers in search of a job”, “extend job search assistance
measures for those who are job-ready”, “ensure a better co-operation
between employment services and the education system to reach youth
as soon as possible when risk of disengagement is detected” and
“maintain those who are hard-to-place connected with the labour
market”.
Note The rapporteur shares this view. Moreover,
in this context, she recalls the proposal of the European Youth
Forum to introduce “youth guarantees” – policy measures that would
aim to ensure that no young person is out of employment, education
or training for more than four months, unless the person chooses
to be.
50. As full employment would be a utopian ideal, income support
in case of unemployment is important for protecting unemployed young
people from social exclusion, while at the same time preventing
them from becoming dependant on social security payments. In other
words, income support must depend on a certain number of conditions
ensuring that unemployed people are making efforts to find work
or are taking part in training/educational programs. Some countries’
practices unfortunately encourage income support dependency. In
Belgium, for instance, young people can request unconditional and
time unlimited income support immediately after finishing their
studies.
Note By contrast,
in Denmark youth income support is subject to certain strict conditions:
young people who receive welfare benefits must attend an interview
in the first week, a job-search training course in the second week
and an educational or work placement within the third week.
Note
51. The rapporteur considers that an intermediate plan could be
implemented with the aim of both protecting young people from the
risk of social exclusion and preventing their dependence on income
support. European countries should help unemployed young people
not only with income support but should also give them new perspectives.
That is to say, public policies must take into account that unemployment
for new entrants in the labour market might penalise them in their
future professional life. A number of measures must be taken to reinforce
the chances of young unemployed people starting over after a period
without work. At the same time, it is clear that European countries
cannot afford to finance social security payments without having
a strong employment policy.
52. Welfare benefits should be allocated under certain conditions
in order to encourage unemployed people to actively seek employment.
In order to reduce the gap between unemployed young people and other unemployed
people, the rapporteur advocates the use of specific measures directed
at 15- to 24-year-olds who do not have access to ordinary income
support because they have not worked the minimum time required. Such
beneficiaries of income support should attend an interview that
offers them more personal assistance in their job/training search
and should be asked to take part in job-search training courses.
Public employment agencies could offer them employment matching
their profiles for a restricted period. Beneficiaries should be allowed
to refuse offers only after proving the incompatibility with their
skills and professional experience. A determined number of unjustified
refusals could be allowed but, once exceeded, beneficiaries should
accept new offers of employment or renounce their right to income
support. The rapporteur notes that the success of these measures
depends on the quality of the public employment agencies and their
efficiency in matching offers to demand and being respectful of
the profiles of unemployed people.
6.2 Measures on education
53. As already outlined in this report, educational systems
have an important impact on youth employment rates. The rapporteur
is convinced that European countries should invest in deep reforms
to remedy the lack of coherence between educational systems and
the labour market that today penalises young people. Several improvements
could be introduced to ensure that young people leave education
with the skills required by the labour market.
54. Special and innovative measures are needed to integrate disadvantaged
young people. Firstly, European countries need to provide the necessary
language training to immigrants in order to facilitate their integration
on national labour markets. Secondly, to limit the problem of young
people that are NEET, European countries should reduce the number
of early school dropouts and assist these young people in making
a fresh start. Here the rapporteur notes that the “second chance
schools” initiatives introduced in several countries (for example
Hungary)
Note could be
a good example to follow. A pilot project was introduced by the
European Union in order to “provid[e] new, tailor-made avenues back
to the world of work and to active citizenship”
Note for young people who dropped out of school
too early to have acquired an adequate educational background in
relation to labour market needs.
55. As a general rule, educational systems should prepare young
people to work in the globalised world by teaching, where possible,
three foreign languages, that is to say English and two other languages.
Note This
is already possible in some countries, but students’ levels vary
enormously from one country to another, so less efficient systems
have to be improved. This idea goes hand in hand with economic opportunities
for international companies and young jobseekers. As European countries
have no other choice but to take part in globalisation, it seems
inevitable that languages have to be learned well at school to facilitate
communication and mobility across multilingual Europe and beyond.
In fact, as European economies are not necessarily specialised in
the same fields, multilingualism could be a balancing factor in
the supply and demand of the European labour market.
56. Furthermore, European countries should try to build better
balanced systems of education including academic studies and vocational
training. Even if it seems obvious to have both, some countries
have not done enough to promote certain professional qualifications
that are in high demand on the market but have lost prestige among
the public. In France, for example, academic studies have become
the goal to achieve for students, regardless of the real needs of
the labour market and the shortage of specialists in certain professions
(notably in manual professions and crafts). Better communication
between all actors involved in the employment process is needed
in order to identify buoyant or promising sectors and guide students
in making their choices. This could enable a better match of offers
with demands in the labour market.
57. Another possible measure could be to establish a better regulation
of admissions to universities. This measure could help achieve a
balance between job offers and jobseekers by orienting young students
to studies which offer better perspectives for future employment.
Limiting access to studies in certain sectors deemed of low priority
could be a good short-term measure to prevent future graduates’
frustration at having to work in sectors for which they are not
qualified. However, this measure must be accompanied by a promotion of
the more promising sectors in terms of jobs or economic development
trends in each country.
58. Last but not least, the rapporteur wishes to introduce the
idea of developing work-linked school courses,
even in academic studies, because
“the combination of solid education and work experience can help to
ensure the long-term integration of young people into the labour
market”.
Note This idea comes after findings that
many academic courses require students to carry out an internship
during their studies. The rapporteur’s advice would be to include
more practical subjects in academic studies and to develop new weekly
timetables with one day of work in order to provide students with
the practical knowledge needed in the labour market. This implies
using a dual system not only for vocational studies but also for
academic courses. Such measure would allow companies to be involved
in the training process, and would thus reduce the gap that currently exists
between educational systems and the needs of the labour market.
7 Concluding remarks
59. Although unemployment and precarious work undermine
the dignity of every individual concerned and the human progress
of society at large, young people are particularly vulnerable. As
the data shows, they are much more affected by unemployment and
the difficulties in entering or re-entering the labour market than
the rest of the population. This is despite the fact that young
people in Europe today have a better level of education than their
parents and that many European countries are facing labour shortages
in a growing number of sectors. With the challenges of globalisation
and the lingering effects of the economic crisis, Europe cannot afford
to waste the talents, energy, mobility and creativity of its youth.
60. The mismatch between the qualifications of young people and
labour market needs, rapidly changing labour market conditions and
eroding public spending on integrated pro-employment strategies
seem to be the main causes of this situation. There is a need for
adjustment in public policies at national and European level, with
a view to promoting better qualifications and skills, more mobility,
an improved access to job offers and a greater interaction between
employers, state employment agencies and young jobseekers. European policymakers
face a moral imperative to better integrate youth in the search
of work before resorting to bringing in high-skilled workers from
non-European countries. This is a vital public interest if Europeans
want to win the global race of competition and avoid major societal
problems in the medium- to long-term.
61. European countries have been testing various solutions to
the problem of youth unemployment and some options seem to yield
quite substantial positive results. Policy options that work best
form part of an integrated framework for economic and human development,
taking national specifics into account. Good education, vocational
training or higher studies and “first job” or traineeship experience
remain a key springboard into working life. Better guidance for
young people in choosing studies-to-job pathways is necessary to
rebalance real labour market demand with sufficiently qualified
– and motivated – jobseekers.
62. Country strategies should take stock of national strengths
and weaknesses in order to make sure that all actors across the
public and private sectors have accurate information about strategic
national priorities, training/retraining/lifelong-learning and employment
opportunities in booming economic sectors, state-supported requalification
options and any pro-employment tax incentives. Additional public
effort may be required to compel enterprises to hire young employees
on decent contractual terms, to create conditions fostering youth
entrepreneurship, to support employment of the most vulnerable young
people and to resort to public-private partnerships for the development
of disadvantaged areas.
63. The United Nations have launched an International Year of
Youth starting in August 2010. European countries could champion
the youth cause by better tapping young people’s potential through
work and thus make substantive progress towards a more just, prosperous,
inclusive and democratic society.
