Global Employment Trends for Youth

Steven KapsosInternational Labour Organization

UN/DESA Expert Group Meeting on Adolescents, Youth and DevelopmentNew York, 21-22 July 2011

Overview1. The big picture:

A. Why focus on youth?B. Youth vulnerabilities in the labour marketC. What we know and what we don’t know

2. Labour market trends for youth: the pre-crisis picture3. Impact of the global economic crisis on youth in the labour market4. Policy responses

1. The big picture

Why focus on youth employment? Inefficiencies in youth labour market

(unemployment, discouragement, working poverty) are costly

Lack of decent work at an early age compromises future employment prospects and impacts behaviour

A young person with hopes and options is happy; take away the options and youth become angry

Future consumers, producers … societies

Why are young people particularly vulnerable in the labour market?

Educational deficiencies Skills/talent mismatch Lack of work experience, professional

contacts, networks Precarious employment contracts/dual

labour markets Last-in, first-out phenomenon

Barriers to entrepreneurship

Quantifying youth vulnerability: What do we know?

What we do not know . . .Unemployed

Discouraged workers

?

Fully employed

?

Underemployed?

In full-time

education ?

Other?

Breakdown of the inactive by reason - how many are in each category?

Inactive

Employed

Shares of underemployed v. fully employed in total employment?

Size of the vulnerable youth population??

What we know . . .

Inactive share

increased from 45.3 to 49.2%

Employed share

decreased from 47.9 to 44.7%

Unemployed share

decreased from 6.8 to 6.1%

Share of working poor - 28.1%

2. Labour market trends for youth – the pre-crisis picture

Share of youth in the total population show declining trend in all regions

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

11.0

13.0

15.0

17.0

19.0

21.0

23.0

25.0Share of youth in the total population, by

region, 1991 to 2015

WORLD

Developed Economies & European Union

Central & South-East-ern Europe (non-EU) & CIS

East Asia

South-East Asia & the Pacific

South Asia

Latin America & the Caribbean

Middle East

North Africa

Sub-Saharan Africa

Source: ILO, GET Youth, August 2010

Employment-to-population ratios decrease over time in most regions19

9119

9219

9319

9419

9519

9619

9719

9819

9920

0020

0120

0220

0320

0420

0520

0620

07

25.030.035.040.045.050.055.060.065.070.075.0

Youth employment-to-population ratio, by region, 1991 to 2007 Developed Economies

& European Union

Central & South-East-ern Europe (non-EU) & CIS

East Asia

South-East Asia & the Pacific

South Asia

Latin America & the Caribbean

Middle East

North Africa

Sub-Saharan Africa

Source: ILO, GET Youth, August 2010

Global youth unemployment rates were decreasing before the economic crisis

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

p20

11p0.0

10.020.030.040.050.060.070.080.090.0

10.010.511.011.512.012.513.013.5

70.0

66.2

65.9 66

.671

.170

.871

.071

.974

.373

.975

.378

.078

.578

.979

.676

.672

.9

11.7

11.111.211.3

12.112.212.212.4

12.812.712.813.213.213.113.1

12.5

11.9

Global youth unemployment and un-employment rate, 1991 to 2007

Youth unemployment (millions) Youth unemployment rate (%)

Yout

h un

empl

oym

ent

(mill

ions

) Youth unemploym

ent rate (%)

Source: ILO, GET Youth, August 2010

But young people remain disadvantaged relative to adults across regions

Middle

East

North A

frica

Centr

al & So

uth-Ea

stern

Europ

e (non

-EU) &

CIS

South-

East A

sia & th

e Paci

fic

Latin

Ameri

ca & th

e Cari

bbean

Develo

ped E

conom

ies & Eu

ropea

n Unio

n

Sub-Sa

haran

Africa

South

Asia

East A

sia0

5

10

15

20

25

30

Youth, 1998 Youth, 2008 Adult, 1998 Adult, 2008

Une

mpl

oym

ent

rate

(%

)

Inequalities in the chances of finding work

Young women tend to have more difficulty finding work than young men.

In most OECD countries, unemployment is higher among the lesser educated youth; in developing countries, it is the highly educated who face longer job searches.

Unemployment rates are typically higher among ethnic minorities.

Young women face much higher unemployment rates than young men in some regions

Middle

East

North A

frica

Latin

America

& the C

aribb

ean

Centr

al & So

uth-Ea

stern

Europe

(non-

EU) &

CIS

South-

East A

sia & th

e Paci

fic

Sub-Sa

haran

Africa

Develo

ped E

conom

ies & Eu

ropea

n Unio

n

South

Asia

East A

sia0

5

10

15

20

25

30

35

Youth male, 2008 Youth female, 2008

Une

mpl

oym

ent

rate

(%

)

Working poverty rates among youth exceed those of adults

0.0

20.0

40.0

60.0

80.0

100.0 Working poverty estimates, youth and adult cohorts15-24 25+

Shar

e of

wor

king

poo

r in

tot

al

empl

oyed

(%

)

Source: ILO, GET Youth, August 2010

3. Impact of the global economic crisis on youth in the labour market

The economic crisis reversed pre-crisis progress in global youth unemployment

2007 2008 2009 2010p 2011p68.070.072.074.076.078.080.082.0

11.211.411.611.812.012.212.412.612.813.013.2

72.9

74.1

80.7 81

.2

78.511.9

12.1

13.0 13.1

12.7

Global youth unemployment and un-employment rate, 2007 to 2011

Youth unemployment (millions) Youth unemployment rate (%)

Yout

h un

empl

oym

ent

(mill

ions

) Youth unemploym

ent rate (%)

p = projectionSource: ILO, GET Youth, August 2010

Youth in developed economies are particularly hard hit

2007 2008 2009 2010p 2011p5.0

10.0

15.0

20.0

25.0

30.0 Youth unemployment rate, by region, 2007 to 2011 Developed Economies

& European UnionCentral & South-East-ern Europe (non-EU) & CISEast AsiaSouth-East Asia & the PacificSouth AsiaLatin America & the CaribbeanMiddle EastNorth AfricaSub-Saharan Africa

p = projectionSource: ILO, GET Youth, August 2010

Impact of the crisis on the industrial sector, particularly construction, resulted in a sharp increase in unemployment among male youth

M = male; F = femaleSource: Laborsta

M F M F M F M F M F M FSpain France United Kingdom United States Germany Ireland

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

50.0

2007 2008 2009 2010

Impact of the crisis in selected countries

Large increase in youth unemployment rates in Spain; little change in Germany.

But in Germany, nearly one-third of those who are unemployed were already unemployed for longer than 12 months; only recently the case in Spain and the UK.

Source: Laborsta Source: Eurostat

2007

Q120

07Q2

2007

Q320

07Q4

2008

Q120

08Q2

2008

Q320

08Q4

2009

Q120

09Q2

2009

Q320

09Q4

2010

Q120

10Q2

2010

Q320

10Q4

0.05.0

10.015.020.025.030.035.040.045.0

Youth unemployment rate (%)

United States GermanySpain United Kingdom

2007

Q120

07Q2

2007

Q320

07Q4

2008

Q120

08Q2

2008

Q320

08Q4

2009

Q120

09Q2

2009

Q320

09Q4

2010

Q120

10Q2

2010

Q320

10Q4

0.05.0

10.015.020.025.030.035.040.0

Share of long-term unemployment in total employment, youth (%)

Germany Spain United Kingdom

Impact of the crisis in selected countries (cont.)

Slight increase in youth part-time employment rates but impact on temporary employment is less obvious.

Part-time employment more relevant for UK youth, but incidence of temporary employment is very low compared to Germany and Spain.

Source: Eurostat Source: Eurostat

2007Q

1

2007Q

2

2007Q

3

2007Q

4

2008Q

1

2008Q

2

2008Q

3

2008Q

4

2009Q

1

2009Q

2

2009Q

3

2009Q

4

2010Q

1

2010Q

2

2010Q

3

2010Q

40.05.0

10.015.020.025.030.035.040.045.0

Youth part-time employment rate (%)

Germany SpainUnited Kingdom

2007Q

1

2007Q

2

2007Q

3

2007Q

4

2008Q

1

2008Q

2

2008Q

3

2008Q

4

2009Q

1

2009Q

2

2009Q

3

2009Q

4

2010Q

1

2010Q

2

2010Q

3

2010Q

40.0

10.020.030.040.050.060.070.0

Share of temporary employees in total paid employment,

youth (%)

Germany SpainUnited Kingdom

Youth unemployment rates say nothing about discouragement

Thaila

ndJap

an

Korea

, Rep

ublic

of

Austria

Mexico

German

y

Austral

ia

Costa R

ica

Hong K

ong,

China

Ecuad

or

Canad

a

New Zea

land

Morocco

United

State

s

United

Kingd

omFin

land

Sri La

nkaIre

land

Swed

enSp

ain0.05.0

10.015.020.025.030.035.040.045.050.0

Youth unemployment rate, 2009Gap between actual and expected youth labour force (share of youth labour force), 2009

Perc

enta

ge

Source: ILO, Global Employment Trends 2011

Impact of the crisis on youth in developing countries

Lack of decent work is nothing new for majority of youth

Dominance of self-employment acts as a buffer, unemployment rates do not significantly increase … increase in vulnerable employment and casual labour in an “increasingly crowded” informal economy

Secondary consequences on education and training, pregnancy and parenthood, health

Longer term impacts on youth entering the labour market during recession Impacts timing of labour market

entry (“hiding out” in education), the smoothness of the transition (multiple spells of unemployment), social norms adopted (mistrust in the State and economic system)

“Lost generation” ?

4. Policy responses to promote decent work for youth

What works?

Key considerations Youth are a heterogeneous group: important to

profile youth for early identification of vulnerabilities

Multi component interventions, well-focused on specific needs of youth and the labour market

1. Addressing skills mismatches Facilitate access to vocational training Entrepreneurship programmes Soft and life skills training programmes Linking employers with educational institutions

What works (cont.)?

2. Addressing slow job growth barriers Active labour market policies Public works programmes Public service programmes

3. Addressing inadequate job matching Employment and intermediation services

4. Addressing poor signalling Skills certification systems

5. Supporting strong labour market information systems

Global Employment Trends for Youth

Steven KapsosInternational Labour Organizationkapsos@ilo.org

UN/DESA Expert Group Meeting on Adolescents, Youth and DevelopmentNew York, 21-22 July 2011