OECD, Directorate for Employment, Labour and Social Affairs
Organisation for Economic Co-operation and Development
Getting the young into jobsSeminar organised by the OECD LEED Trento Centre
26-28 October 2009, Trento, Italy
Presentation of the main findings of the OECD project
JOBS for YOUTH
Anne SONNET
Team Leader of the Youth Project
Directorate for Employment, Labour and Social Affairs, OECD
Outline of the Presentation
1.Thematic review on Jobs for Youth
2.Youth labour markets in OECD countries
3.Recommendations
2
JOBS for YOUTHReview of 16 OECD countries (2006-2009)
9 EU countries: Belgium, Denmark, France, Greece, Netherlands, Poland, Slovak Republic, Spain and United Kingdom
7 non EU countries: Australia, Canada, Japan, Korea, Norway, New Zealand and United States
Process: questionnaires, replies, fact-finding mission, writing up, seminar, publication
12 country reports already published, 4 to be published in late 2009 (Poland, Denmark, Greece and the United States)
3
JOBS for YOUTH
4
JOBS for YOUTHSynthesis Report in 2010
The review process has highlighted a number of structural problems that affect the transition from school to work and the initial labour market experiences of young people with different levels of education
The current economic crisis is exacerbating some of the underlying problems as presented in the document Helping Youth to Get a Firm Foothold in the Labour Market discussed at the OECD Labour and Employment Ministerial Meeting (28-29 September 2009)Tackling the Jobs Crisis: The Labour Market and Social Policy Response
5
JOBS for YOUTH
In general, youth face a much higher risk of unemployment than adults
On average in the OECD , the ratio of 15-24 to 25-54 unemployment rates is close to 3 in mid-2009
Unemployed as a % of the labour force
6
0
5
10
15
20
25
30
35
40
15-24 25+
OECD 15-24 = 17.6
OECD 25+ = 6.5
Source: National labour force surveys.
JOBS for YOUTH
Youth are particularly exposed to a major downturn
There is a significant deterioration of 15-24 unemployment rates mid-2009 compared to end-2007
7
0
5
10
15
20
25
30
35
40
2007q4 2009q2
Source: National labour force surveys.
Unemployed as a % of the labour force
JOBS for YOUTH Access to employment is closely associated with education achievements and
skills needed on the labour market
The employment probability of school-leavers aged 15-29 was much higher in 2006 for tertiary graduates, except in the South of Europe
8
Employed as a % of youth aged 15-29 having left education
Source: OECD Education database.
0
20
40
60
80
100
120
140Less than upper secondary education
Upper secondary education
Tertiary
* Share of youth in with less than upper secondary education in parenthesis.
9
Expected number of years spent in employment in the five years after leaving education, 2008
JOBS for YOUTH
The transition takes time almost everywhere, particularly for low-skilled youth
Years in employment
Source: European Union labour force survey.
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0Total Low-skilled
10
AUT
BEL
CHE
CZE
DEU
DNK
ESP
FIN
FRA
GRC
HUN
ISL
ITA
LUX
NLD
NOR
POL
PRT
SWE
SVK
GBR
R² = 0.6823
70
72
74
76
78
80
82
84
86
88
90
0 10 20 30 40 50 60 70
Em
plo
ym
ent ra
te o
f yo
uth
ag
ed
25-
29 n
ot
ined
ucatio
n
Share of students aged 15-24 who work
Percentages, 2008
Combining school and work facilitates labour market entry
There is a positive correlation between the employment rate of youth aged 25-29 and the share of students working before they reach 25
JOBS for YOUTH
Source: European Union labour force survey.
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JOBS for YOUTH
0
10
20
30
40
50
60
70Minimum adult wage Minimum wage at 17 Minimum wage at 20
The cost of employing low-skilled youth is too high in some countries
Minimum wage as a percentage of the median wage by age, 2007
Source: OECD, Minimum wage database.
JOBS for YOUTHRecommendations: Target groups
Two groups of youth have difficulties in getting a firm foothold in the labour market
• The group of “poorly integrated new entrants” *
• The group of “youth left behind” *
• The size of these two groups is likely to increase during the recession, heightening the risk of long-term scarring
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JOBS for YOUTH Recommendations: Policy challenges
A comprehensive, coherent, partnership and well co-ordinated approach based on 4 mutually-reinforcing areas:
1. Education
2. School-to-Work Transition
3. Labour Demand
4. Active Labour Market Policies
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JOBS for YOUTH Recommendations: Policy challenges
1. Education
• Ensure that everyone leaving the educational system is capable of gaining the skills needed on the labour market
• Ensure better co-operation between employment services and the education system to reach youth as soon as possible when risk of disengagement is detected
• Strengthen apprenticeship targeted at low-skilled youth and young immigrants
• Promote second-chance learning opportunities for school drop-outs
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JOBS for YOUTH Recommendations: Policy challenges
2. School-to-Work-Transition
• Make the transition from school to work less abrupt
• Promote the combination of work (no more than 15 hours a week) and study
• Set up compulsory internships at university starting at the bachelor’s level
• Penalise firms that abuse “fake internships” for young people who have already graduated
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JOBS for YOUTH Recommendations: Policy challenges
3. Labour Demand
• Tackle the demand-side barriers to youth employment
• Reduce the cost of employing low-skilled youth: youth sub-minimum wage, reduction in social security contributions paid by employers for low-pay workers
• Continue efforts to reduce labour-market duality overall: “flexicurity” framework
• Fight discrimination against the hiring of visible minorities
• Actively encourage the mentoring of graduates with an immigrant background
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JOBS for YOUTH Recommendations: Policy challenges4. Active Labour Market Programmes
• Make active labour market measures for the leastemployable youth more effective with a rigorous “mutualobligations” approach
• Provide more resources to personally assist unskilled young people to find jobs and improve governance in order to better co-ordinate national and local actions
• Make social assistance conditional to a learning obligation to get a qualification
• Make sure that skill-upgrading services offered are tailored to the current profiles of jobless youth
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JOBS for YOUTH Recommendations during the crisis
• Key short-term challenges
• Prevent the current generation of school-leavers becoming a“lost generation”
• Secure the safety net and the employment and trainingpathways of young workers
• Making active labour market measures for the leastemployable young people more effective and strengtheningsocial protection for the most disadvantaged
• Prepare young people to be ready and equipped for workfor the recovery
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JOBS for YOUTH• “Poorly integrated new entrants”, who often have diplomas, frequently go back-
and-forth between temporary jobs and unemployment, even during periods of strong economic growth
• On average in the OECD, 35% of youth employment was temporary in 2008, 5 percentage points more than in 1998
Temporary employment as a % of employment among 15-24
19
0
10
20
30
40
50
60
70
802008
1998
OECD 1998 = 30.4OECD 2008 = 34.8
*Source: National labour force surveys.
JOBS for YOUTH• “Youth left behind” cumulate disadvantages (no diploma; from immigrant/minority
background; living in deprived neighbourhoods) and are at risk of dropping out of the labour market
• The NEET group (neither in employment, nor in education or training) represented 12 % of 15-24-year-olds in the OECD in 2006
As a % of the age group
20
*Source: National labour force surveys.
0
5
10
15
20
25
30
35
40
45
Inactive
Long-term unemployed
Short-term unemployed
OECD = 11.7
