EU’s Youth Guarantee to end “social emergency” of youth unemployment

Recent economic announcements have been a true rollercoaster ride, with unemployment figures falling to one of the lowest levels, but then national output also falling. This disconnect between unemployment and GDP is still confusing economist, but the real worry is that youth unemployment is doing as expected, if not exceeding expectations. Youth unemployment in the UK now stands at just under 1 million, with over 1 in 5 young people now out of work. This has recently risen to the highest level since 2011.

Across the EU this picture does not improve with youth unemployment standing at 23.7% which equates to 7.5 million people under the age of 25 out of work. EU President Barroso was not understating this when he called it a “social emergency” where we are looking at an entire generation that will be scarred by unemployment who without jobs and without work experience will continue to find it difficult to get jobs in the future, to buy a home and to have a settled family life.

Further to the effect on the young population, there is a huge economic effect as the cost of youth unemployment is estimated to be €53 billion a year throughout the EU, this equates to 1.2% of the EU GDP.

Last year the government launched the Liberal Democrat policy to get young people back into work with a Youth Contract. This contract made available a £1 billion fund aimed to get young people into work through apprenticeships, work placements or training. Originally this offered businesses a £2275 subsidy for hiring under 25’s who has been unemployed for more than nine months, this has now been reduced to six months to include more young people.

The Youth Contract aims to create nearly half a million training or employment opportunities up until 2015, and despite few objections there has generally been widespread approval of the scheme, which is starting to bear some fruit.

In the New Year, the European Parliament debated a scheme called the Youth Guarantee. In a similar way to the Youth Contact this scheme would seek to make an offer of employment, training or education to any person under the age of 25 who has been out of work for four months. While the EU does not have the legislative powers to enforce the Youth Guarantee it can make it easier for national governments to implement. For example, the commission has already talked of making the European Social Fund available to help pay for this.

I hope that the our government in the UK will look at any of the suggestions that are made in the Youth Guarantee and see if the Youth Contact can be extended even further to make more opportunities available for under 25’s. Youth unemployment is a serious issue in this country as it is across the EU and we need to make sure we are doing as much as we can to tackle it, otherwise we face the prospect of losing a generation of young people from our economy.

* Richard Davis is a prospective Member of the European Parliament for London. His website is here.

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5 Comments

  • Very noble. But the ‘Parliament’ should keep it’s nose out and leave this field to each member state. It is their problem, not something which a one size, blinkered approach institution with a tin ear can legislate for.

  • Richard Dean 1st Feb '13 - 11:31am

    It is good to have the European Parliament trying to help – protectionism would not be a solution, would it?
    Will the help be anything like enough?

  • @cogload – It is up to each region (of the UK) to set its own priorities from a “menu” of possible options that the ESF contains. As it happens, youth employment is one of the ESF priority areas of the UK regions.

    It is perfectly legitimate for the Parliament to express an opinion on the ESF’s spending priorities given that it dates back to the EEC’s creation in the 50’s.

  • Your figure for UK and European youth unemployment includes full time students of course.

    The true youth unemployment figure for the UK is 12.4%, not ‘one in five’.

    http://epp.eurostat.ec.europa.eu/statistics_explained/index.php/Unemployment_statistics

  • Old Codger Chris 3rd Feb '13 - 4:08pm

    Cogload – “The‘Parliament’ should keep it’s nose out and leave this field to each member state”.
    Unfortunately the British parliament can’t be trusted to deliver. Connexions provided jobs advice – and much more – to young people. The coalition destroyed it.

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