Youth Unemployment - A broader view
Posted on October 29, 2015 by Paul Mac Flynn
Youth unemployment remains one of the most enduring and destructive legacies of the financial crash and the great recession that followed it. Rates of unemployment among young people (those aged under 25) increased dramatically over the 2007 - 2009 period. The NERI's Quarterly Economic Facts indicator 2.4 shows youth unemployment rates across the 28 members of the EU and the contrasting fortunes of Germany where the rate is 7% and Spain where the rate is 48.6%. Youth unemployment is generally higher than unemployment for the working age population as a whole in both good and bad economic periods and the gap between Germany and Spain broadly reflects the impact of the recession on both these economies. However it would be misleading to think that the recent economic downturn is the only reason for such a wide gap. Countries like Greece and Spain have historically had much higher rates of youth unemployment for structural reasons. Countries like Germany, Denmark and the Netherlands have a fully developed system of vocational education which provides options for young people who do not
Northern Ireland has a youth unemployment rate of 18.4% for the three months ending in August this year. This is down from a high 22.6% in 2013, but only marginally below the 2009 rate of 18.9%. Indicator 2.5 of the QEF discusses the 19% of 18-24 year olds in Northern Ireland classified as NEET (Not in Education, Training or Employment). The rate is just below that of the Republic of Ireland at 19.5% and is significantly up from the 15% that both recorded in 2002. While a reduction in NEETs back the 2002 level would be welcome, it should not be viewed as sufficient. Northern Ireland's NEET rate has been consistently two and a half times the rate in the Netherlands from 2000 - 2015. The rate in the Republic of Ireland has been almost double that of Denmark over the same period.
The current rates of youth unemployment are unacceptably high and need urgent action to remedy, but it would be tragic if policy only aimed to ameliorate the impact of the last few years. Policy solutions need to focus on a long-term ambition of reducing structural youth unemployment by investing in a coordinated education and skills infrastructure that leaves no one behind.