Public Employment Servicesand Youths paths to purpose

“Each young person has the right to see a possiblefuture.”

Dr. Borbély-Pecze, Tibor Bors

National Labour Office, Hungary

borbelytibor@lab.hu

Stockholm, 6-7 March, 2013

Ways of working – The case of the Hungarian PES

Main characteristics of young job-seekers in Hungary

According the LFS standards • Employment rate: 15-24 ys: 18,3% • Unemployment rate: 29% (2012, LFS)• NEET 15-29 ys:17,7% (2010, EF)

– 40,7% unemployed

Within PES registry • Under 25 ys: 100 thousands (~15% of all registered) • 72,8 thousands (according Employment Act, ~11%) (NLO, Jan. 2013) • More than 1/3 max. primary school educated, another 1/3 at

ISCED 3-4 levels• 1,5-2% yearly loss of the GDP (EF, 2012)

(source: EF 2012:46)

Changing boundaries within the lifespan

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Donald E. Super

Hungarian PES recent practices

Looking for balance between active policy measures and service provisions

Fish or net or both?

Employment policy toolkit for career starters

• Measures to stimulate labour demand and facilitate getting the first job (e.g. tax reliefs);

• Youth programmes launched with the involvement of NGO and non- profit organisations (e.g. innovative employment programmes);

• Programmes targeted at students in VET (e.g. traineeship programme);

• Programmes encouraging self-employment(e.g. encouraging young persons to become entrepreneurs);

• Active labour market policies (e.g. complex labour market programmes);

• Programmes promoting mobility (e.g. housing allowance)• Career guidance services • Job mediation

Tax reliefs for career startersFrom 2013, on the gross wage of every employee under age 25 – and up to a salary of HUF 100 000 (~EUR 360) –, the rate of employers’ contribution (social contribution tax and vocational training contribution) will be 14% (instead of 28.5%). The employment of career starters will be even more favourable than before: the allowance will be 28.5 per cent of the gross wage in the first two years of employment for employees aged under 25 with maximum 180 days in employment up to a salary of HUF 100 000.Estimated budget: EUR 500 millionEstimated effects: 200 thousand young persons

National Job Protection Plan 2013

Reforms of VET and compulsory education systems

• Prior to Year 9, engagement of persons with completed 8-year elementary education in remedial preparatory courses under the HÍD (“Bridge”) programme to fill general knowledge gaps.

• From Year 9, engagement of persons with completed 8-year elementary education in two-year VET courses including general studies up to 33%. That would enable students to enter practical training as early as Year 9 and learn and appreciate their profession and work.

• Engaging persons with incomplete 8-year elementary education in HÍD programme courses offering partial vocational qualifications.

“First Job Guarantee” (2012, 2013)

• In September 2012, the Government launched a new labour market programme known as “First Job Guarantee” designed to support the entry into employment of young persons under age 25.

• Under the measure, employers hiring registered job seeking career starters in part-time or full-time employment may be entitled to a subsidy for maximum 4 months, the amount of which is 100% of total labour cost up to twice the minimum wage (HUF 186 000), plus the refund of travel expenses.

• Any employer hiring or intending to hire an employee can be subsidised in the programme – i.e. economic entities with or without legal personality and private persons and their associations

• without legal personality, as laid down by law – regardless of sector or form of business. The period for engaging in the programme is from 6 August to 30 November 2012, while subsidising employment is possible between 1 September and 31 December 2012

• 7142 young people were included in 2012, • Plan for 2013

– Extended budget – The programme will be open for every young people under 25, expect the participants of the 2012

programme – 6 months subsidy + 3 monthly further employment

National LLG Portal –the new PES site

Opening page Channel opening page

Occupation description Online questionnaires

Developing the system of career guidance

Thank you for you attention!

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Dr. Borbély-Pecze, Tibor Bors

NLO

borbelytibor@lab.hu