What is the current situation?
In March 2013, 5.7 million young persons were unemployed in the EU-27, of whom 3.6 million were in the euro area. The youth unemployment rate was 23.5% in the EU-27 and 24% in the euro area, relatively stable over the month, but up by respectively 0.9 percentage points and 1.5 percentage points compared to March 2012.
In March 2013, the lowest rates were observed in Germany and Austria (both 7.6%), The Netherlands (10.5%), and the highest in Greece (59.1% in January 2013), Spain (55.9%), Italy (38.4%) and Portugal (38.3%).
What is the EU doing to tackle youth unemployment?
The Youth Guarantee Recommendation was adopted by the EU’s Council of Ministers on 22 April 2013 (see MEMO/13/152). The European Commission urges Member States to now put in place the structures to make the Youth Guarantee a reality as soon as possible.
The Commission will soon present further initiatives to support Member States in their efforts to put in place their youth guarantee scheme.
What is the Youth Guarantee?
The Youth Guarantee, based on experience in Austria and Finland, seeks to ensure that all young people up to age 25 receive a quality offer of a job, continued education, an apprenticeship or a traineeship within four months of leaving formal education or becoming unemployed.
The Youth Guarantee is one of the most crucial and urgent reforms required to address youth unemployment and to improve school work transitions.
A Youth Guarantee has a fiscal cost for Member States, but this cost is much lower than the cost of inaction. First, the cost depends on national circumstances: it will be lower in Member States where supporting measures are well developed (e.g. well-trained Public Employment Service (PES) staff to address young people’s needs).
Second, it depends on the way in which the scheme is set up and implemented. Third, it will be greater in countries with high rates of young people not in employment, education or training (NEETs) or of youth unemployment.
The EU can help Member States with financial support from the European Social Fund (ESF). With the Youth Guarantee in mind, the proposal for the ESF Regulation for the next programming period 2014-2020 includes a dedicated ESF investment priority targeting the sustainable labour market integration of young NEETs.
Member States facing high youth unemployment rates are thus expected to identify young unemployed persons as well as NEETs as a specific target group for ESF funding.
In addition, the February 2013 European Council proposed a €6 billion Youth Employment Initiative "in particular to support the Youth Guarantee following its adoption". The Youth Employment Initiative is due to earmark at least €3 billion from the ESF (with Member States encouraged to more than match ESF funding) and a further €3 billion from a new dedicated budget line to fund measures to support young people, including the Youth Guarantee.
Youth Employment Initiative funding is due to be open to all regions where youth unemployment is over 25%.The Commission proposed operational rules in March 2013 (see IP/13/217) to allow Member States to start using the Youth Employment Initiative's financial resources immediately once the new 2014-20 budget framework comes into force.
What is the Quality Framework for Traineeships?
In addition to helping young people to find work, the Youth Employment Package also launched a consultation of European social partners on a Quality Framework for Traineeships, so as to enable young people to acquire high-quality work experience under safe conditions and to guard against traineeships being exploited by companies as simply a source of cheap labour.
A recent study on a 'Comprehensive overview of traineeship arrangements in Member States (see IP/12/731) confirmed that young trainees face different problems during their traineeship(s) in most EU Member States.
These problems mostly relate to the lack of a high quality learning content, low or no remuneration, poor working conditions other than remuneration/compensation (e.g. lack of proper social protection coverage, long working hours, no equal treatment etc.) and – as a consequence of the previous problems combined with the differences in national traineeship legislations – a relatively low level of intra-EU mobility of trainees.
Following the social partners' decision not to enter into negotiations on this subject, the Commission is planning to present its own proposal on a Quality Framework for Traineeships before the end of 2013.
What is the European Alliance for Apprenticeships?
Effective vocational education and training systems, in particular those that include a strong work-based learning component, facilitate the transition of young people from education to work. This is why the Youth Employment Package also announced a European Alliance for Apprenticeships, to improve the quality and supply of apprenticeships across the EU.
This alliance will bring together stakeholders from authorities, business and social partners, vocational education and training researchers and practitioners and youth representatives. It will coordinate existing actions under a common umbrella and promote the benefits and ways of successful apprenticeship schemes and ways to build them up. It is due to be launched in July this year.
How can mobility benefit young people?
The gap between the countries with the highest and lowest youth unemployment rate is very high. In March 2013, the lowest rates were observed in Germany and Austria (both 7.6%), the Netherlands (10.5%), and the highest in Greece (59.1% in January 2013), Spain (55.9%), Italy (38.4%) and Portugal (38.3%).
At the same time, the latest European Vacancy Monitor indicates that there are still around 2 million unfilled vacancies in Europe, partly as a result of jobseekers not having the skills that employers are seeking. In the current situation of high unemployment and strong divergence across Member States, labour mobility can play an important role to alleviate unemployment in countries affected by the recession while helping to meet skills gaps and fill vacancies in other Member States.
That said, whether or not to seek work in another Member State remains a personal decision for the individual concerned.
Is there not a risk of "brain drain"?
Whilst it is true that the home country loses out in the short-term when a worker moves abroad, the situation is nevertheless better than if the worker stayed in the home country unemployed. As long as the migrant worker remains employed abroad, he or she can contribute to the economy of their home state through remittances.
In practice, when there is an economic upturn, workers overwhelmingly go back to their home country to make use of the skills they have acquired in the meantime. This was demonstrated for example by the number of Polish workers who moved to the UK to work after 2004 but have now returned to Poland.
What kind of additional support can EU Structural Funds provide?
As a result of the Action Teams exercise, by the beginning of 2013, around €16 billion of EU funding had been targeted for accelerated delivery or reallocation. This funding will help around 780 000 young people and 55 000 SMEs as well as supporting other growth-enhancing measures. Funding allocation for Greece:
Greece
A national youth action plan was endorsed in January 2013 with EU funding of €517 million. The plan is intended to promote youth employment, training and entrepreneurship and targets nearly 350,000 young people.
According to the Greek authorities, the new initiatives that have already started (EU funding approx. €47 million) include the temporary hiring of young unemployed (up to 35 years old) in community-based work programmes in the cultural sector as well as the provision of support to social structures aiming at combating poverty and social exclusion for the recruitment of young unemployed. In addition, preparations are at a final stage as regards the effective implementation of the following schemes of the action plan (EU funding approx. €146 million):
• "voucher for entrance in the labour market" which combines training with a five month job placement in enterprises and targets 45,000 young unemployed up to 29 years old
• blended theoretical and on-the-job training for 1000 young unemployed seamen up to the same age limit. Implementation of the above schemes is expected to start in June 2013.
• Revision of programmes in 2012 aimed at providing an additional support of EUR 1.2 billion to address the liquidity needs of SMEs.
