Unemployed youth: Southern Europe’s disaffected

JON VAN HOUSEN and MARIELLA RADAELLI

Some are calling it the Lost Generation. Millions of youth across southern Europe are unemployed, with many working as interns, remaining at home with parents or even emigrating to other countries in search of a job.

Though a slight improvement over a year previous, nearly 19 percent of those under age 25 and not in school in the euro zone were unemployed in August. The long, grinding effect of recession or sluggish growth over the past decade has left many young jobseekers feeling disenchanted or even hopeless.
Unemployment Italy, English news
It has become a generation of interns in some countries, most of them unpaid.

Study after study shows that on average they will have a long unlikely climb to match the lifestyle and success of their forebears. But they don’t need a report to tell them that. Many have already accepted the fact they will be hard-pressed to start a family without the help of their own parents.

The trend is particularly marked in southern Europe, where 43.3 percent of those in Greece, 38.7 percent in Spain and 35.1 percent in Italy were unemployed in June this year. By comparison, the youth jobless rate in Germany was 6.4 percent in August.

Without a fulltime job, many look to get experience and a foot in the door through internships. In Spain, 56 percent of those aged 16 to 29 have served one internship and 11 percent have had two. Just 29 percent of the total number of internship were paid. In Portugal, 43 percent had one internship and 13 have had two. In Ireland the ratios were 44 and 9 percent, but three-quarters of those were paid. In Greece, 68 percent of internships were unsalaried.

Across the 28-member European Union, just 27 percent of interns at companies are offered real jobs at the end of their temporary service.

The lack of opportunities in many countries is also causing a so-called brain drain as the well-educated leave. A study by the University of Thessaloniki found that more than 120,000 professionals including engineers, doctors and scientists left Greece between 2010 and 2013. The number of emigrating Italians, many highly qualified graduates, rose by 30 percent between 2011 and 2012, with the highest increase in the 20 to 40-year-old age group. In Spain, the number who moved abroad rose by 114,000 in 2013 compared to the previous year.

According to Fondazione Migrantes, which tracks emigration from Italy, the most popular destination for the country’s emigres overall was Germany, followed by the UK, Switzerland and France. Over two-thirds stayed within Europe, with the majority of the rest moving to North America.

The long economic hardship is also fueling English-language studies. In a continent awash in 24 official languages, parents and governments now see early English tuition as crucial in the global economy. More than 90 percent of primary school students have English studies in Spain, Italy, France and Poland. Overall the EU average is 77 percent.

Mario Draghi, the Italian economist who has served as president of the European Central Bank since 2011 and helped guide the EU through the aftermath of the global recession, says the weight of the crisis fell disproportionately on young people.

It has left “a legacy of failed hopes, anger and ultimately mistrust in the values of our society and in the identity of our democracy”, says Draghi. But he notes young people are doing much better in Germany and Austria, countries he says have better vocational training that targets more vulnerable younger people.

“The vocational education system, together with more flexible wages and stronger public support for helping the unemployed to seek and find jobs, as well as lower labor market segmentation, explains in part why the youth unemployment rate is lower in Germany than in France,” the ECB president says.

He thinks “governments know how to respond — they should do so for the future of their countries’ youth and for their democracies”.

Part of that response should be clear reform and streamlining of elaborate employment laws.

Ironically, labor laws designed to protect workers make it more difficult for companies to hire them. With the EU’s economy finally recovering, more than half of all new jobs created in the region since 2010 have been through temporary contracts, according to a recent European Council study. The prolonged financial crisis left employers wary of hiring permanent workers in an economy that is only starting to gain traction. Under current European labor laws, permanent workers are usually more difficult to lay off and require more costly benefit packages, making temporary contracts appealing for all industries ranging from low-wage warehouse workers to professional white-collar jobs.

A bewildering number of studies and efforts are attempting to identify and implement programs to aid youth employment, but the EU likely doesn’t need yet another conference or study. Companies already facing high tax rates have to be able to hire and fire – known in bureaucratic jargon as labor market flexibility – without months or years of additional financial guarantees to workers.

Many nations also need to streamline their legislatures so new measures can be implemented more quickly. Fewer senators with salaries for life, less endless debate and a lot more real grassroots growth would be a good start.

A version of this story appeared in the Khaleej Times of Dubai.