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Solutions to Youth Unemployment by Bridging the Job Market Gap
(Assistant Professor University of St. Gallen)
Peter Vogel Strategy [email protected]
Prof. Dr. Peter Vogel
From Education to Employment
3© Prof. Dr. Peter VogelAugust 11th, 2015
Some more facts
In developing economies, close to 80% of young workers work in informality
Most statistics ignore the NEETs In the US, 15% of youths are NEETs In the EU, the NEET rate increased by 2%
over crisis
ILO: “The youth unemployment rate (12.6% in 2013) would be a full percentage point higher if it included the NEETs”
e
10million
unemployed youths
Snapshot Latin America (total youth: 106 million)
million youth that
neither work nor study
million youth work in informality
Youth (15-24) Unemployment Indicators
1.2 billion youth worldwide = 17% of total population
75 million are unemployed = 40% of total unemployed
Data Sources: ILO, OECD, Eurostat, World Population Prospects
30
22
Drivers of the Youth Unemployment Crisis
6© Prof. Dr. Peter VogelAugust 11th, 2015
Demand Side
Low aggregate demand
Inflexible labor markets / temporary jobs
Informal recruiting inaccessible to youth
False expectations of employers
retirement age keeps older workers
Supply Side Lack of preparedness for work Lack of adequate skills and experiences Academic inflation Characteristics / attitude towards work Rise of youth population in some regions False expectations of young people
Mismatches
Skills / capabilities mismatch
Over-qualification
Under-qualification
Regional differences (developed vs. developing)
Expectations mismatch
Digital Natives: A Generational Snapshot
8© Prof. Dr. Peter VogelAugust 11th, 2015
Speed & convenience
Shift of basic skills
Little online privacy
Virtual life replaces real life
Over-exposure to information
Education is regarded as less valuable
Need for confirmation and mentoring
What if We Don’t Find Adequate Solutions?
9© Prof. Dr. Peter VogelAugust 11th, 2015
Individual Consequences Scarring effect on the person’s human-
and social capital Negative life-long effects on earnings Negatively influences psychosocial
development and overall well-being Prevents young people from developing
adequate work ethics Difficulty of young people to become
independent from parents Forces young people to accept part-time
or temporary employment Increases chances of subsequent
unemployment
Societal & Economic Consequences Waste of economic potential Threat of an undermined social stability Brain drain towards countries with better
job opportunities Loss of tax earnings for countries Increased criminality rate and anti-social
behavior, requiring more security
It is estimated that joblessness in the United States alone will account for a total of $20 billion in lost earnings over the next ten years Jacobs, 2014
Intersection Education System – Labor Market
11© Prof. Dr. Peter VogelAugust 11th, 2015
“I always thought that by graduating from a renowned university I would easily find a job within a few months time. But I was wrong. Now it is over a year and things just won’t get any better. Neither for me nor for my peers…” (Hanna, 25, recent graduate from a leading business school)
75% of European universities provide little or no career guidance (Futurework Forum)
No, and I would not use it anyway
Yes, and it is useful
Yes, but it isnot useful
No, but I wouldfind it useful
Necessity to Bridge the Job Market Gap
12© Prof. Dr. Peter VogelAugust 11th, 2015
Supply-Side
In the EU-28 there are 6 million
unemployed youth that are
employable but cannot find a job (Eurostat)
Demand-Side
In the EU-28 there are 4 million jobs
that could not be filled because the
employers couldn’t find the
individuals with the right skills (G. Hultin,
2010)
Addressing the Mismatch
“It is imperative that we find solutions to bridge the job market gap & connect the
right talents with the available jobs, no matter where they are!” (FutureWork Forum)
Panelists
13© Prof. Dr. Peter VogelAugust 11th, 2015
Michelle BlanchetFounder & Director
Educators’ Lab
Carsten SudhoffFounder & CEO
CircularSociety AG
Panel Questions
14© Prof. Dr. Peter VogelAugust 11th, 2015
What changes are needed from both the education system and the
labor market to bridge the job market gap?
Which role does dual education / vocational training play in solving
youth unemployment?
What are some of the responsibilities of educators and employers?
What are some of the best-practices we know?
Thank you for your attention!
15© Prof. Dr. Peter VogelAugust 11th, 2015
(Assistant Professor University of St. Gallen)
Peter Vogel Strategy [email protected]
Prof. Dr. Peter Vogel
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