The ILO report for 2006 gives a grim picture of the global crisis of youth employment.
IN 2004, the International Labour Organization (ILO) presented a dismal picture of the employment trends among the youth. Two years down the line, the scene is not very different. The organisation's report, "Global Employment Trends for Youth", for 2006, reveals the sorry state of youth employment in developing economies and demystifies certain notions about the factors that cause unemployment in the 15-24 age bracket. Much of national and international intent on addressing this issue has remained confined to rhetoric, it observes. The report, however, does not explore the reasons for this trend, nor does it analyse why it is so in some countries. In short, it does not provide a holistic picture of the social, economic and political conditions prevailing in the countries where the rates of youth unemployment and underemployment are high. Neither does it seem to pinpoint or underscore that the current trajectory of economic development and globalisation might not have augured well for the majority of the youth in terms of security of employment and quality of jobs. Nevertheless, it does draw world attention to a problem hitherto ignored.
Hence, what it does point out are the perils of ignoring the agrarian sector, particularly in countries in South Asia, South-East Asia and sub-Saharan Africa, where much of the unemployment and underemployment appear to be concentrated. The report also hints that while employment opportunities may have increased in some countries, it is not necessary that the jobs generated can be described as decent work. There is also no direct correlation between the high rates of economic growth and decent employment. Also, high rates of economic growth may not necessarily have an "employment content".
The crisis of youth unemployment and underemployment is more poignant in the developing economies, except perhaps East Asia. The highest regional youth unemployment rates are observed in West Asia and North Africa (25.7 per cent) followed by the Central and Eastern Europe, sub-Saharan Africa, Latin America and the Caribbean (16.6 per cent), South-East Asia and the Pacific (15.8 per cent), South Asia (10 per cent) and East Asia (7.8 per cent).
There are basically two kinds of unemployed, says the report. The first category comprises those who are looking for employment but are unable to find it; the second category consists of those who work under poor conditions and get willy-nilly thrown out of the labour market. They are also called "discouraged workers". Currently, 85 million unemployed youth and 300 million working poor youth subsist at the $2 a day level and around 20 million discouraged youth face a deficit of decent work opportunities. The three categories together comprise around 35 per cent of the world youth population.
The report demystifies the notion that access to education is no longer a major challenge for young people. While not denying that education enrolment has gone up over the world and more people are staying on in education, the report says that the trends are far from being uniform. Access to education is still a major challenge for most young people, especially in South Asia and sub-Saharan Africa. What is surprising was that countries in Central and Eastern Europe faced in 2006 similar problems in guaranteeing access to higher education. Affordability was one of the main reasons. However, it would have been more enlightening had the report thrown some light on the situation as it was before the Balkanisation of Europe in the post-Soviet era. Free and universal education is the only way out, recommends the report.
The second popular assumption and misconception that it demystifies is that education automatically leads to decent employment. It argues that while this may be true in developed countries, it is not so in the developing economies where economic development has not kept pace with the increases in educational attainments. One of the most obvious examples is the abundance of unemployed youth with higher education degrees. What the report does not explore is the creation of certain "socially valued" jobs in certain countries that most youth aspire for, failing which there is disappointment and alienation.
A third and very important misconception highlighted in the report is the perception that young people generally like to look or "shop" around for the best job. The "shopping around" was more likely to occur in a context where there was an abundance of demand for such skills; for example, the demand for computer programmers in the U.S. in the 1990s. While this demand itself has come down with the decline of the boom economy, nowhere in the world is insecurity of employment an exalted value, especially where there are not too many good jobs going around. Security of employment is often preferred over job satisfaction, and "shopping around" is more a developed economy phenomenon. But even in these countries, the picture might not be all that rosy. French youth made history when they came out on the streets in February last year protesting against the Contrat Premiere Embauche or "first employment contract" introduced by the government.
A pro-employer hire-and-fire law, the contract allowed companies to hire young people by introducing a flexible system of hiring those under 26 for two years, during which the employee could be dismissed at any time for any reason. The government withdrew the contract after widespread protests. Clearly, job security was high on the priority list even for the youth in a developed country like France.
Yet another misconception is that unemployment is the only issue confronting the majority of youth. The problem may not have so much to do with joblessness as with the quality of the work going around. In developing countries, a strange trend was noticed, in which youth representing well-off socio-economic backgrounds were over-represented in unemployment numbers because they were in a position to "shop around" without any wages. The report, however, does not mention to what extent this over-representation is or what proportion of the total number of young job-seekers this constitutes. But the majority of the youth appeared more bothered with the conditions of work rather than unemployment itself. Another popular misconception was that the poor are poor because they do not work, that they are indolent and rely on social safety nets. These notions are used to describe the poor among the youth also. But what is unnoticed is that there is a situation not of normal poverty, but of extreme poverty along with an absence of social safety nets. This forces people to work in conditions that are at the subsistence level.
While youth unemployment seems to be increasing, youth labour force participation rate (the share of the labour force in the working age population) has decreased globally. The sharpest increases in youth unemployment due to economic crises over the last 10 years were in South-East Asia, the Pacific, Latin America and the Caribbean.
During the past decade, only the developed economies and the European Union saw a considerable decrease in unemployment. The report attributes this to a combination of successful youth strategies coupled with fewer younger people in the workforce. With a growing aging population in the developed economies, it is evident that the demand for employment is being generated in the developing economies mainly. In fact, even with developing countries reaching the final stages of the demographic transition (this is described as a stage of demographic shift: a country goes through three stages; in the first, the proportion of the young increases in the population; in the second, it declines and that of the elderly cohort, 65 years and above, increases modestly accompanied with a sharp increase of adults; and, finally, in the third stage, the proportion of adults declines and that of the old increases) even by 2015, the youth cohort will constitute approximately one-fifth of the total population in developing economies, the bulk of them being in sub-Saharan Africa and South Asia.
What is the state of the working poor amongst the youth? According to the United Nations, one in five young people in the world lives in extreme poverty, and using the $2 (cumulative household income) a day criterion, nearly half of all young people can be categorised as living in poverty. The "working poor" make an interesting category. They are in some kind of work but yet are unable to find decent and productive work. Their work, therefore, is characterised by long hours, low wages, and lack of contract and security.
They are found in the informal economy. It is also a matter of great irony that sub-Saharan Africa, which has been on the radar of global and donor attention for several decades now, continues to have six out of every 10 young people in situations of extreme poverty. There seems to be a connection, albeit limited, between tertiary enrolment in education and youth inactivity. Youth inactivity is a condition where young persons are neither employed nor unemployed. Interestingly, youth inactivity rates rose between 1995 and 2005 and continue to be the highest in West Asia, North Africa and South Asia.
Wary of making any broad generalisations, the report concurs that the likelihood of a young person in a high-income country being inactive is higher than that of his counterpart in a low-income country. But what is glossed over is that there may be disparities within some of the "low-income" countries also where a section of the upper middle class youth is "inactive", primarily because it can afford to do so.
Inactivity may not be an option for most youth in poor countries but there is a section in some of the developing economies - a growing section that has benefited from the economic policies of the governments concerned - that exercises this option. In fact, in some Commonwealth of Independent States (CIS) countries, youth inactivity rates have increased. Enrolment declined in higher education in Central and Eastern Europe (non-E.U.), the CIS region and sub-Saharan Africa.
In South Asia, especially India, enrolment in higher education is less than 10 per cent. The report rightly underscores the link between poverty and declining educational enrolment.
The need to focus on the 18-24 age group has never been as acute as before and the social consequences of this cannot be emphasised enough. Lack of decent work, says the ILO report, if experienced at an early age, has the potential of permanently compromising a person's future employment prospects and could well lead to social exclusion. The trend is clear and it can only be reversed by conscious government policy aimed at addressing these new work-related vulnerabilities.