Youth Unemployment – Causes and Consequences

By Stefan Humpl, 3s Unternehmensberatung GmbH

In all employment systems in the world the integration of young people into the labour market is an important task. Statistics (e.g. on all OECD countries) show a higher rate of youth unemployment compared to the overall unemployment rate. Even minor economic crises make the youth unemployment rates grow faster, in the light of the actual economic depression youth unemployment is rapidly growing all over the world.

Even when specific factors to tackle youth unemployment are varying highly in different economic and social circumstances, one can name the main problems. On the one hand we see different views from expectations of young people from the labour market and its reality. These different views come from gender role models (e.g. in Austria approximately 50% of young women want to work in only 5 occupations like hairdresser or secretary). But there are also different expectations, like many prefer to earn money at the time instead of thinking of long term career development. Most European countries face a lack of personnel in technology and natural sciences, but have a lot of students in human and social sciences.

New forms of labour promise individual and flexible working conditions. But most of them lack social safeguarding for young people on the labour market. Individualisation and flexibilisation is often followed by “precarisation”, which means a high economical risk through only day-to-day jobs.

Classical factors for youth unemployment are often mentioned in employment research, like low education and high drop out rates in education. But also social integration problems (like crime or drug abuse) cause unemployment. In many countries we see integrational problems of minorities or persons with migration background. And also early motherhood is a factor for employment problems in many societies. Most of these factors do not come alone, so normally we face the combination of several of the mentioned factors for youth unemployment.

If we try to subsume globally the problems that cause youth unemployment, we can define them at the interfaces and transitions between school education and the labour market, school education and other forms of education, social exclused groups and (school) education as well as the labour market.

The consequences of youth unemployment resemble the causes – so we have to speak of a vicious circle. Youth unemployment causes low self confidence and low self empowerment. Young people unemployed are at the risk to lose their place in society and turn to seclusion, drug abuse and sometimes even criminality. Other consequences are the loss of perspectives through having no chance for a straight forward career development and the loss of qualifications through not using them on the labour market.

To tackle this doom loop it is necessary to

- Help in all transition processes (through guidance, job orientation, self-empowerment, etc.)- Help in integration into society- Tackle systemic preconditions (like schoolish systems with no alternatives to drop out)