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Youth unemployment is the lack of job opportunities for people typically aged 15–24 years old. This age range is determined by the period when mandatory schooling ends through the age of 24. In order to qualify as unemployed for official and statistical measurement, the individual must be without employment, willing and able to work, of the officially designated 'working age' and actively searching for a position. Historically, the youth unemployment rate has been two to three times higher than in older age groups. It is typically higher in developing countries, but has become a problem in countries around the world, including those in the global north. During the 1960s, the United States and Canada were the only industrialized countries to have youth unemployment rates over 10 percent, but by the 1980s many more countries had double digit youth unemployment rates. The recession in 2008 has affected employment rates for youth in Europe and North America significantly. In 17 middle-income countries surveyed, all saw a moderate or significant decrease in wage employment during the recession. In Latin American countries, youth shifted to the informal sector to avoid unemployment during the 2008 economic recession.

Causes

Youth unemployment is higher than adult unemployment for several reasons. Employers often rely on stereotypes about youth that cause them to prefer older workers. Youth also have less experience searching for work, making it a more difficult process where they are likely to find less success than older employees.

Economy

Historically, changes in the economy have had a larger effect on youth unemployment than overall unemployment. The economic recession had a big affect on the current rate of youth unemployment in the global north. In 2007, before the recession began, the youth unemployment rate was 13 percent as compared to 5 percent among older workers. This number has now increased to around 20 percent for youth, more than 2 times the national average of 7 percent as of March 2012. When there is a general hiring freeze, the youth unemployment rate grows as youth move from school into the workforce. The effects of limited economic growth was visible in the mid-1970s in the United States. While the economy weakened, the number of young people in the labor force grew and the youth unemployment rate grew as well.

Increased Education Expectations

Youth are expected to have more education to compete for jobs than was true for previous generations, a phenomenon referred to as credential inflation or academic inflation. Youth are expected to stay in formal schooling for longer periods of time. Employers use credentials as a way to evaluate whether youth applicants are good potential employees, requiring youth to seek education and delay entry into the workforce. Education credentials are also used as a screening method, forcing more youth to remain in education to meet the requirements of employers. The increasing the amount of time that youth spent spent in education, causing an equivalent rise in the average age when full-time employment begins.

Temporary Contracts

Young people are more likely to have internships or other temporary forms of work. Once this work ends, many find themselves out of a job. Because their jobs are temporary contracts, youth are often the first to be laid off when a company downsizes If they are laid off, youth are typically not eligible for redundancy payments because they only worked with the company for a short period of time. However, some youth are entering work on a part-time basis during tertiary education. This rate is low in countries like Italy, Spain and France but in the United States almost one-third of students combine education and work.

Mobility

In community-oriented countries, youth are often less mobile than older workers. When the attachment to home is strong and when youth rely on parents for financial support, they are less able to move locations to find a job than older workers who can move their entire family. The youth being supported financially by parents are also able to wait longer before accepting a job, meaning that they remain unemployed for a longer period of time.

Case Studies

The individual experiences of youth unemployment vary from country to country.

United States

The general unemployment rate in the United States has increased in the last 5 years, but the youth unemployment rate has jumped almost 10 percentage points. In 2007, before the most recent recession began, youth unemployment was already at 13 percent. By 2008, this rate had jumped to 18 percent and in 2010 it had climbed to just under 21 percent. The length of time the youth are unemployed has expanded as well, with many youth in the United States remaining unemployed after more than a year of searching for a job. This has caused the creation of a scarred generation, as discussed below.

United Kingdom

Main article: Youth unemployment in the United Kingdom

The United Kingdom has experienced increased youth unemployment in the past few years, with rates reaching over 20 percent in 2009. The term NEET originated here, meaning youth that are not in education, employment or training.

Russia

Youth unemployment in Russia was over 18 percent in 2010. However, there was a wide variance in levels of unemployment in Russia just a few years earlier, that continued through the 2008 economic crisis. In 2005, the area around Moscow had an unemployment rate of just 1 percent while the Dagestan region had a rate over 22 percent. This may be partially attributed to the differences in levels of development in the region. It has been found that the higher the level of development in a region, the lower the level of both overall and youth-specific unemployment. In Russia, the main cause of youth unemployment has been attributed to lower levels of human capital.

India

The youth unemployment rate was around 10 percent in 2005, but they haven't reliably reported statistics to the United Nations over the years. However, there has been an increase in young adults remaining in school and getting additional degrees simply because there aren't opportunities for employment. These youth are typically of a lower class, but it can represent a wide variety of individuals across races and classes. They call the phenomenon timepass because the youth are simply passing time in college while waiting for a paid employment opportunity. In India, the employment system is reliant on connections or government opportunities.

Jordan

There are 15 million unemployed young men in Arab communities. The youth unemployment rate in Jordan has traditionally been much higher than other countries. In the past ten years, the rate has stayed around 23 percent. There has been a recent increase in the popular belief that unemployment is the fault of the individual and not a societal problem. However, youth unemployment has also been attributed to increased pressure on service sectors that typically employ more youth in Jordan. Youth unemployment has led to later and later ages of marriage in Jordan, which some view as one of the most important consequences of the phenomenon. Another consequence experienced in Jordan is increased mental health problems.

Consequences

Youth unemployment has many long-term consequences for the individual and for their country. Some individual consequences involve finding employment in unrelated or unfulfilling tracks. For some countries, high youth unemployment causes youth to leave the country in search of employment. High youth unemployment has led to social unrest and political revolutions. The recent Arab Spring movement and the protests in Greece are recent examples of this.

Mental Health Risks

Being unemployed for stretches in youth has been correlated to decreased happiness, job satisfaction and other mental health issues. Some youth end up committing suicide because they feel that they are a failure and are of no importance to their communities. Unemployed youth also report more isolation from their community.

Family Impact

Youth are increasingly moving back in with their parents when they can't find employment or find themselves unemployed. This has been seen as both an effect and a cause of high youth unemployment. Youth in many countries now live with their parents into their late twenties. Although this has been common in collectivist countries, it is growing increasingly common in more individualist countries. In families, it is common that when one person becomes unemployed, other members of the family begin looking for or securing employment. This is called the added worker effect. It is common in more common in collectivist societies because family members support one another. This can sometimes take the form of employment in the informal sector when necessary.

Unpaid Work

When faced with no opportunity for wage employment, some young people will turn to unpaid work. Many students and recent graduates in the United States have attempted to work their way into a paid job by working for free through unpaid internships. Although these experiences are offered as a learning opportunity with the potential for paid employment at the completion, some youth find that these jobs are little more than menial labor. This ends up leaving them even more unprepared to enter the paid job market because they have less applicable skills.

Decreased Earnings

Another consequence of youth unemployment is decreased earnings over their entire lifetime for those who are unemployed in youth. Because they aren't able to build up skills or experience during their first years in the workforce, unemployed youth see a decrease in lifetime earnings when compared to those who had steady work or those who were unemployed as an adult. The penalty has been estimated to be a 20 percent decrease in salary. The lower salary can persist for 20 years after the unemployed period before the individual begins earning competitively to their peers. While not earning money during unemployment, the youth could be contributing to a pattern of poverty for their generation. Widespread youth unemployment leads to a generation that is excluded socially and at a great risk for poverty. It also widens the gap between the rich and poor even further. For example, Spain saw an 18 percent increase in income inequality.

Creation of a Scarred Generation

A scarred generation or a lost generation describes how a generation is harmed when many of its members cannot find work. After long-term unemployment, youth are in danger of losing skills, connections to their industry, and desire to work long into the future. After a period of unemployment during a recession, the individual will find it difficult to find work once the economy improves because they have a large gap in their work history. Instead, employers will be more likely to hire those in the next generation who are just out of school.

References

Category:Unemployment Category:Economic problems Category:Labor economics