Combating Youth Unemployment : The European Perspective and Policy Response Middlesex University London 13 November 2015 Eamonn Davern European Commission Employment Strategy Unit

How Serious is the Youth Unemployment Problem? 5 million under 25 year olds unemployed 21.4% Youth Unemployment 44 ppt gap between lowest and highest countries (EUROSTAT Dec 2014)

Macro-Economic Youth Unemployment Factors More sensitive to economic cycle Young less experienced - more prone to lay offs Concentrated in vulnerable sectors More likely on short term contracts 50% changes in Youth Unemployment cyclical Structural changes can be positive, investment in ALMP,education,training/education

NEETS in Europe 7.5 million NEETS (aged 15-24) EU 28 NEETS aged % (2008) to 15.4% (2014) (EUROSTAT Dec 2014)

Significant Differences across EU NEETs rate aged years Greece 26.7% Luxembourg 6.5% Italy 26.2% Denmark 7.3% Bulgaria 24% Netherlands 7.6% Spain 20.7% Germany 8.7% United Kingdom 13.4% (10 th In EU 28) (EUROSTAT Dec 2014)

European Policy Context (1) NEET most problematic youth unemployment issue Europe (2020) Initiative Youth on the Move Youth Opportunities Initiative To provide pathways back into education/training and establish labour market contact

European Policy Context (2) European Commission Employment Package Towards a Job Rich Recovery (2012) Stressed importance of decreasing NEET rates by enabling transitions to work. New indicator introduced to monitor NEET situation (from 2014 part of joint employment report scorecard)

European NEETS Heteregenous Population Largest sub-group Conventionally Unemployed Other NEETs Sick and disabled Young Carers Non-vulnerable NEETS

Young people at greatest risk of becomong NEET Low levels of education Migrant background Disability and health problems Family issues

Social and Economic cost of inactivity 2011 economic loss (benefits paid – lost output) from youth labour market disengagement Euro 153 billion (1.2% European GDP) Loss exceeds 2% in Bg Cy Hu Ire It Ltv Pl Much greater social disengaement (Eurofund Report 2011)

Adverse Consequences for Individual NEETs Disaffection Insecure future employment Higher rates of youth offending Mental and physical health problems

The Youth Guarantee Commission Proposal December 2012 Adopted by Council of Ministers 22 April 2013 Endorsed by European Council June 2013 G20 Melbourne September 2014 called for more action on youth unemployment

Youth Guarantee Policy Intention Structural reform to improve school to work transitions and measure to immediately support jobs for young people Based on successful experience in Finland and Austria

Youth Guarantee Commitment Within 4 months of leaving school or losing job young people under 25 receive either: good quality job suiting their education, skills, and experience, aquire education, skills and experience required to find a job in the future through apprenticeship, traineeship, or continued education

Youth Guarantee Implementation All Member States have presented Youth Guarantee Implementation Plans Plans and implementation assessed as part of European Semester (EU re-enforced economic surveillance framework) Employment Ministers endorsed Youth Guarantee Indicator/Monitoring framework December 2014.

Required Supply Side reforms in Member States Structural reforms needed include improved : ALMP Training Job – Search Education – including combatting early leaving Outreach Quality and quantity of aprenticeships and VET CSRs in 2014 for 8 EU Member States PES Reform, co-operation decision May 2014

Identification and Activation of NEETs Tools and Strategies involving all who have access to unregistered young people Key actors include : Social Services, Education Providers, Youth Associations

Youth Guarantee boost for demand for young labour Temporary well targeted wage and recruitment subsidies Apprenticeship and traineeship grants Business development support : European Structural and Investment Funds and European Investment Bank COSME Programme

Social Investment in Youth Employment Youth Guarantee high priority in Partnership Agreements setting Strategic Framework for Structural and Investment Funds Euro 86 billion ESF (Youth Employment measures including Guarantee) Supplementary support from Youth Employment Initiative Euro 6.4 billion (targets NEETS – regions exceeding 25% Youth Unemployment (20 MS) eligible

Further Initiatives complementing Youth Guarantee Quality Framework for Traineeships (adopted by Council of Ministers March 2014) European Alliance for Apprenticeships launched July 2013

Key Policy Messages Diverse menu of instruments needed Labour market readiness of beneficiaries must be considered Young people need long –term sustainable pathway Involving range of stakeholders in design is essential Client centred not provider focussed measures needed Success depends upon innovation

Thank you for your attention Questions ?