The Scale of Youth Unemployment

Nat O'Connor04/07/2013

Nat O'Connor: Ireland's economy is contracting again, unemployment is at 13.6 per cent and over 60,000 people emigrated over the last two years (net of immigration, CSO population report). Unemployment across the EU is at record high levels (12.2%) and Enda Kenny was not wrong when he recently called the high levels of youth unemployment "an abomination" (RTÉ)

Eurofound reports that 14 million young people (aged 15-29) are NEET: Not in Employment, Education or Training.

So what's the strategy for medium-term economic recovery, development and prosperity? And how are we going to generate good jobs, especially for younger people?

The recently announched EU Youth Guarantee will make up to €8 billion available, as part of the next seven-year budget of the EU. "The funds will form the basis of a 'Youth Guarantee' that aims to provide a job, training or apprenticeship to young people within four months of their leaving school, full-time education or becoming unemployed." (Reuters)

However, "Economists have derided the scheme as a public relations exercise, and even the leaders conceded the plan would have little impact unless member states took action themselves."

€8 billion is c.€571 for every young person currently in the NEETs category (to say nothing of those currently aged under 15 whose futures are equally uncertain). That's just over €80 per year, although logically the expenditure should be front-loaded.

While this might pay for an 'intervention' of some description, like advice or a small amount of training, it is not anything like the right scale to provide paid apprenticeships or jobs. In Ireland, you could employ someone for less than two weeks at the minimum wage for €571.

So, the Youth Guarantee is not a strategy. At best, it will provide a trickle of useful money that will facilitate national governments setting up training schemes and assistance to find employment.

But what would a strategy look like? Today, TASC launched a series of papers looking at themes in industrial policy, including innovation, competitiveness, State supports to enterprise and our 12.5% Corporate Tax rate.

Each paper makes a specific contribution to the discussion, and they are meant to provoke thought. For example, Paul Sweeney estimates that between €4.7 and €6.2 billion is spent by Ireland annually to support enterprise here. That's very roughly 10 to 15 per cent of all public spending. And in contrast, Ireland's proportionate share of the Youth Guarantee is likely to be around €11 million per year (assuming 1% of €8 billion divided by 7 years).

This contrast shows that we have a lot more internal capacity that we might imagine to focus resources towards employment, education and training, but it requires a reevaluation of existing policies and activities, guided by a coherent medium-term vision or 'strategy' for how we can make better use of these resources to achieve the sustainable growth of good jobs.

Dr Nat O'Connor     @natpolicy

Nat O'Connor

Nat O’Connor is a member of the Institute for Research in Social Sciences (IRiSS) and a Lecturer of Public Policy and Public Management in the School of Criminology, Politics and Social Policy at Ulster University.

Previously Director of TASC, Nat also led the research team in Dublin’s Homeless Agency.

Nat holds a PhD in Political Science from Trinity College Dublin (2008) and an MA in Political Science and Social Policy form the University of Dundee (1998). Nat’s primary research interest is in how research-informed public policy can achieve social justice and human wellbeing. Nat’s work has focused on economic inequality, housing and homelessness, democratic accountability and public policy analysis. His PhD focused on public access to information as part of democratic policy making.


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