TODAY -

Global Youth unemployment Trend 2013

Prof E Bijoykumar *

Job for all or unemployment allowance' - A rally in the heart of Imphal :: July 7 2012
Job for all or unemployment allowance' - A rally in the heart of Imphal on July 7 2012 :: Pix - Banti Phurailatpam



The latest report released by International Labour Organisation says that it is not easy to be young in the labour market today. The burden of unemployment has disproportionately fallen on the youth. The prolonged jobs crisis has forced the current generation of youth to be less selective about the type of job they are prepared to accept.

Increasing numbers of youth are now turning to available part-time jobs or find themselves stuck in temporary employment. Secure jobs have become less easily accessible for today's youth. The global youth unemployment rate, which had decreased from 12.7 per cent in 2009 to 12.3 per cent in 2011, increased again to 12.4 per cent in 2012, and has continued to grow to 12.6 per cent in 2013.

In absolute terms 73 million young people are estimated to be unemployed in 2013.Globally, the ratio of youth to adult unemployment rates is estimated to be 2.7 in 2013. It means Young people continue to be almost three times more likely than adults to be unemployed.

The upward trend in global unemployment continues to hit them strongly. Though they are willing to work at the prevailing wage rate they donot get any work.The economic and social costs of unemployment, long-term unemployment, discouragement and widespread low-quality jobs for young people continue to rise and undermine economies' growth potential.

Skills mismatch on youth labour markets has become a persistent and growing problem. Over- education and over-skilling coexist with under education and under-skilling, and increasingly with skills obsolescence brought about by long-term unemployment. Such a mismatch makes solutions to the youth employment crisis more difficult to findand more time consuming to implement.

Moreover, to the extent that young people in employment are actually overqualified for the job they are doing, society is losing their valuable skills and forfeiting stronger productivity growth that would have been achieved had these young people been employed at their appropriate level of qualification. When under skilled workers are employed the quality of work suffers ,potential of growth cannot be realised and it is another aspect of the social cost of mismatch. Minimisation of the mismatch is possible with rigorous manpower planning .

In developing regions where 90 per cent of the global youth population lives, stable, quality employment is especially lacking.indeveloping economies where labour marketinstitutions, including social protection, are weak, large numbers of young people continue to face a future of irregular employment and informality. Young workers oftenreceive below average wages and are engaged in work for which they are either overqualified or underqualified. As much as two-thirds of the young population is underutilized in some developing economies, meaning they are unemployed, in irregular employment, most likely in the informal sector, or neither in the labour force nor in education or training.

There is a price to be paid for entering the labour market during hard economic times. It leads to "scarring" in terms of future earning power and labour markettransition paths. Perhaps the most important scarring is in terms of the current youth generation's distrust in the socio-economic and political systems. Some of this distrust has been expressed in political protests around the world .

Many a times we attribute our crisis to unemployment. But going by the conventional measures of unemployment such as usual status, current weekly status and current daily status we find our unemployment rates exceedingly low. It is also possible that what counts is income based unemployment rather than the time based criterion that we use.

What then is the source of the current youth generation's distrust in the socio-economic and political systems? Improving youth labour market outcomes requires an in-depth understanding of employment and labour market issues that are country specific. In a country as diverse as ours it needs to be region specific.

Analysis of youth labour markets, with particular emphasis on the issues that characterize youth transitions to decent work, is crucial for determining country-specific needs and for shaping policies and programmatic interventions. In countries and regions with high poverty levels and high shares of vulnerable employment, the youth employment challenge is both a problem of poor employment quality and of unemployment.

For instance, South Asia and Sub-Saharan Africa present relatively low regional youth unemployment rates, but this is linked to high levels of poverty, which means that working is a necessity for many young people. Low unemployment rate co-exists with poverty. In India, there is evidence that youth unemployment rates are higher for families with incomes over the US$1.25 poverty rate than for those with incomes under this poverty line. Poor households cannot afford to remain unemployed irrespective of the remunerations.

Labour markets in developing economies in general are very different from those in developed economies, more so for the youth. The irregular nature of employment among youth and the tendency for youth to leave education early in developing economies are the labour market characteristics that contrast with those of youth in developed economies. Compared with advanced economies, developing countries face the additionalchallenges of underemployment and working poverty, with young people dominating the workers in the informal economy in both rural and urban areas.

Youth unemployment is a serious issue in low-income economies. Moreover, the unemployed young people in low-income economies do not benefit fromthe social protection systems that are available to their counterparts in developed economies. The youths are much more excluded than the adults in access to livelihood. Opportunities provided by access are very different from protection by the joint family system.

Five key policy areas that can be adapted to national and local circumstances were identified by the representatives of governments, employers and workers of the 185 ILO Member States at the International Labour Conference (ILC) in June 2012 and are included in the Resolution "The youth employment crisis: A call for action".

The policy areas include:
i) employment and economic policies to increase aggregate demand and improve access to finance;
ii) education and training to ease the school-to-work transition and to prevent labour market mismatches;
iii) labour market policies to target employment of disadvantaged youth;
iv) entrepreneurship and self-employment to assist potential young entrepreneurs; and
v) labour rights that are based on international labour standards to ensure that young people receive equal treatment.

There is a world wide growing concern for youth unemployment. Any scarring at this stage is bound to leave long negative impressions. We are not going to get another chance. After all we live only once.


* Prof E Bijoykumar wrote this article for The Sangai Express
The writer is at Economics Department, Manipur University
This article was posted on May 19, 2013



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