ILO: Global Youth Unemployment Outlook ‘Bleak’

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Global youth unemployment remains high. Census Bureau photo.

Global youth unemployment will remain high. Census Bureau photo.

‘Bleak’ is the word the Geneva-based International Labour Organisation uses to describe the global outlook for youth unemployment.

Global youth unemployment young people will worsen as the effects of the euro crisis spread to emerging economies, according to a new ILO paper titled “Global Employment Outlook: Bleak Labour Market Prospects for Youth.”

“Ironically, only in developed economies are youth unemployment rates expected to fall in the coming years, but this follows the largest increase in youth unemployment among all regions since the start of the crisis,” said Ekkehard Ernst, lead author of the paper and chief of the ILO’s Employment Trends Unit.

Indian children at work.

Many Indian children have no choice but to work.

New forecasts for youth unemployment in developed economies predict a gradual improvement from 17.5% this year to 15.6% in 2017. The rate is still far higher than the 12.5% level of a decade earlier in 2007.

Even this small bit of decline isn’t actually good news.

Much of the decline in the youth unemployment rate is due to numerous young people dropping out of the labor force. Young people who would like to work, but have stopped looking because they cannot find a job are not counted as unemployed.

Global and Regional Youth Unemployment Figures

• The projected drop in youth unemployment in developed economies is not expected to help lower the global unemployment rate.
• The ILO says the global youth unemployment rate will reach 12.9% by 2017 – up 0.2 percentage points from 2012 forecasts.
• The impact of the euro crisis will expand to East Asia and Latin America as exports to advanced economies drop.
• In North Africa and the Middle East, youth unemployment rates will remain above 25% during the next few years and could rise further.
• Youth unemployment rates are forecast to rise from 9.5% this year to 10.4% in 2017 in East Asia. Little change is seen in Latin America and the Caribbean and Sub-Saharan Africa.

Supporting Young Workers Has Big Benefits

Even in countries with early signs of a jobs recovery and where new vacancies are opening up, many unemployed youth still find it difficult to land a job.
For example, a construction worker whose job fell victim to the housing bust might not have the skills needed in sectors that are hiring.

“This leads to discouragement and rising NEET rates (“neither in employment, education or training”) among young people,” said Ernst.

“Schemes using employment guarantees and an emphasis on training could help get jobseekers off the street and into useful activities, providing a safeguard against further economic stress,” he added.

Forecasting Youth Unemployment Rates
2012         2017
Global                                                           12.7%      12.9%
Central and South Eastern Europe 16.9%       17%
Developed economies                           17.5%       15.6%
East Asia                                                      9.5%        10.4%
Latin America & the Caribbean         14.6%      14.7%
Middle East                                               26.4%     28.4%
North Africa                                              27.5%     26.7%
South Asia                                                  9.6%       9.8%
South East Asia & the Pacific             13.1%      14.2%
Sub-Saharan Africa                               12%         11.8%

According to ILO research, such youth guarantees can come at very limited cost, less than half a percent of GDP among European countries.

“In times of constrained public finances, this may seem like a large additional burden, but it will be less than the additional costs that come from young unemployed people permanently losing touch with the labor market,” the update said.

ILO Calls For Action On Youth Unemployment

At its annual conference in June 2012, the ILO adopted a Resolution calling for immediate, targeted and renewed action to tackle the youth employment crisis.

The resolution provides a portfolio of tried and tested measures in five areas: macro-economic policies, employability, labor market policies, youth entrepreneurship and rights. It underscores the need for balance, coherence and complementarity across the policy measures.

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