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WORLDWIDE JOB CRISIS HITS YOUTH HARDEST

SARID Staff, October 31, 2006

Earlier this year, the International Labour Organization (ILO) warned that, despite strong GDP and trade growth, low interest rates and record corporate profits, the world is facing an unprecedented global jobs crisis of mammoth proportions. Now, a new report by the UN agency shows that the hardest hit are some of the most economically productive age groups in society; young people between the ages of 15 and 24 years.

In this age group, unemployment has risen nearly 15% from 74 million to 85 million in the past decade. More than 300 million young people, or approximately one fourth of the total youth population, are living below the poverty line of US $2 per day per person. This includes one out of two working youth who are classified as the "working poor ".

Unemployed youth make up almost half of the world’s total unemployed, though they represent only 25% of the total labor force. The report also says youth are more than three times as likely to be unemployed than adults and that the relative disadvantage is more pronounced in developing countries, where youth represent a significantly higher proportion of the labor force than in developed economies.

The trend is even worse for young females, who are four times more likely to become unemployed than adult females. The gap in labor force participation rates between young men and women are larger in developing regions, being most marked in South Asia, followed by the Middle East and North Africa. Such gaps result from cultural traditions, lack of opportunities for young women to combine work and household duties in both developing and industrialized regions, and a tendency of labor markets to shed young women more rapidly than men when fewer job opportunities are available.

Regionally, the highest youth unemployment rate was observed in the Middle East and North Africa, followed by Central and Eastern Europe (non-EU) and CIS, East Asia manifested the lowest. The Developed Economies and EU region was the only grouping to show a considerable decrease in youth unemployment over the last 10 years. The report attributed this to a declining number of young people in the labor force rather than successful employment strategies.

The youth population growth continues to outpace employment growth. Whereas the number of young people grew by 13.2 per cent between 1995 and 2005, employment among them grew by only 3.8 per cent to reach 548 million. In some regions, such as the Developed Economies & EU, South East Asia, South Asia and especially East Asia, this lack of participation in the work force correlates to youth to staying longer in education, as opposed to falling out due to discouragement, as for instance, in Sub-Saharan Africa.

However, Higher educational attainments do not guarantee finding employment, in particular decent employment. In many developing regions, economic development has not kept pace with the increases in educational attainment and/or the educational system has not provided the skills most needed in the economy, as the numbers of unemployed high school and college graduates attest.

Youth throughout the world are not only finding it difficult if not impossible to find jobs, let alone decent jobs. The report defines decent employment as “work that offers a worker a good income, security, flexibility, protection and a voice at work”, and which is more likely to be found in the developed economies. Also highlighted is the fact that since most youth cannot afford to be unemployed or inactive, they often wind up in the informal economy which provides the only outlet for those who are unable to find paid employment in the formal economy.

The report also cited a "worrisome" increase in the number of young people who are neither in employment nor in education. It emphasizes that today's youth face serious vulnerabilities in the world of work and warns that a lack of decent work, if experienced at an early age, may permanently compromise their future employment prospects.

The agricultural sector, and thus rural areas, still accounts for more than 40 per cent of total employment in the world and is still the dominant employer in many regions of the world. Despite increasing rural to urban migration, therefore, employment creation in rural areas should still play a large role in youth employment strategies and overall poverty reduction strategies. In fact, improving wages and reducing poverty within the rural economy will go a long way toward stemming the tide of migration of young people into already crowded urban cities.

The ILO stresses the importance of giving young people a proper foothold from which to maximize their productive potential, and that of future generations and imagines the difference it would make if all this wasted potential were tapped. Creation of decent work opportunities for young people should be the priority in terms of turning what is currently wasted productive capacity in large parts of the world into a positive force for development.