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Opportunity Knocks at the Door of EU, But Not For Youth

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Opportunity Knocks at the Door of EU, But Not For Youth

 


Harping on about rhapsodious aspirations and opportunity knocks at the door of the youthful unemployed of Europe. Or, that’s the way politicians in the EU from Paris to Berlin believe that it all fits into place in the nice little puzzle that they have concocted as Merkel slaps Hollande on the back (yes, it’s her that does the back-slaps, these days;Hollande is far too jelly-wobbly). But one thing the political leaders of Europe have forgotten: opportunity might well be knocking on the door of the EU in the light of the recent improvements, but the door has been bolted and chained for so long for the youth of Europe that by the time they get that damn door open it will be too late and they will be old and grey.  Europe will have created hoards of people, just like China, willing and ready to work. Trouble is that the only difference they have with the Chinese is that the youth of Europe will still be trudging to the dole office to collect the meager benefits that will be dished out in the hope of living a life of subsistence and little else, rather than jumping on the bandwagon to the nearest factory.


EU


Dole Street


Dole Street


There are barrels being rolled out and the champagne corks are popping in Paris, the beer overflowing in Berlin as the EU announces a 0.3%-increase in economic growth for the area for the second quarter of 2013. But, the partying won’t be happening in some sectors of the economy.


  • The EU’s youth will be stuck at incredible levels of unemployment for a long time to come and will be forced to accept temporary jobs to tide them over, at least filling up their résumés and gaining some experiencing, despite the fact that they’ll probably be underpaid and they’ll be over-exploited.

  • Just back in June 2013, the European Central Bank had made a prediction of a0.6%-contraction for the EU this year. Is that a case of telling the guys out there that it is going to be bad, really bad, and then the little good seems like a gift from the gods?

  • Youth unemployment has traditionally always been higher than for other age groups and that is especially true for some countries in the EU, which tend to give no chance at all to young people fresh out of higher education.

  • Youth unemployment has been two and a half times higher than unemployment in general since 2012 in the EU.

  • Youth unemployment has risen from 15% to over 23% in the EU since the financial crisis began.

  • Nearly 8 million people aged 15 to 24 are out of work at the moment.


But, the economy in the EU might expand it might grow as much as the Merkels and the Hollandes want it to over the next year. But, the youth unemployment problem is not going to go away. Opportunity won’t be knocking on the door of those young people that have been out of work, underemployed or doing jobs that give them no experience in the field that they graduated in. Opportunity doesn’t knock on the doors that have been kicked in, does it? The unemployed youth of the EU today will have to compete with fresh, dynamic grads just out of school, eager to get their first job, while they have been discouraged and disheartened by the poor chances of getting a good job that they were trained for. That will mean more people entering the market to find a job.


Youth Unemployment


Youth Unemployment


The leaders of the EU might have realized that in as much as political promises and hankering pledges are ardently revealed to tell us that the question of youth employment is at the heart of the debate. But the policy of youth employment might be out there on the radar but it doesn’t mean that it will succeed in coming to fruition. The ‘Youth Guarantee’ initiative to get every young person in the EU into a job or apprenticeship within four months of being unemployed, might be nothing more than an empty promise from a candidate that is looking to be reelected. Pledging €8 billion (over two years) will have little effect on the 1 in 4 Greeks, or the 1 in 5 young Spaniards. That means every young person that is unemployed at present will be able to count upon €850 a piece per year on average. That’s not going to pay for any training for anybody, is it really? But, it sounded good, when it was announced. The scars that have been inflicted on the young unemployed in the EU today will not heal with €8 billion; they probably won’t heal at all. The generation will become the lost generation of non-workers as they will be too old by the time the EU economy picks up.


It’s not just the EU that will have the tough problem of making sure that the youth find employment today, it’s all over our western economies.


USA


The figures in the US are little better for the American youth non-employment rate (unemployed people as well as discouraged workers that have not looked for work in the previous 4 weeks).


  • The US has about 40% of young people that are currently employed in jobs that have lower requirements than their qualifications today.

  • 60% of students borrow to go to college and that means 12 million people each year in the USA.

  • 37 million people have outstanding student loans in the country.

  • Outstanding student-loan debts amount to between $902 billion and $1 trillion today. The Federal Reserve opts for the lower figure, naturally.

  • 42% of people who took out loans are today aged between 30 and 50 years old. In order for the US economy to get back to levels of youth employment that would be equal to pre-financial crisis days, the country would have to create some 4 million extra jobs today on average, according to studies.

  • Half of the number of people that are currently unemployed in the USA are under the age of 34 today.

  • There are 16.2% of US youth that are currently unemployed today.

  • Although, again that figure, despite the fact that it is double the national level for other age groups, could betwice the quoted figure if people that are discouraged from looking for work and also those that are underemployed but still seeking a full-time job are also included in the statistics.

  • The US government might issue all of the statistics to the public, but the only one that gains any attention from the mainstream media is the figure that excludes people who have not looked for work for 4 weeks because they are discouraged from doing so and those that are working perhaps as little as just one hour a week at times.


The young unemployed people of our economies that we are told are improving need more than just promises of small amounts of money to get them into jobs. But, like the older generations, they will be forgotten amongst the debris from the parties that are raging in Paris and Berlin over the small glimmer of economic growth that has just tainted the horizon.

The following article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.

Posted-In: Eurozone Economics Markets

 

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