Youth Guarantee to combat youth unemployment – but will it?
For several years, the high youth unemployment figures have posed major challenges for decision-makers at EU and Member State level. Accordingly, there are high expectations for the Youth Guarantee.
The proposal for a recommendation on establishing a Youth Guarantee forms the core of the package of measures for youth employment proposed by the European Commission in December 2012. Adopted in April 2013, the Youth Guarantee is intended to ensure that the Member States provide all young people up to the age of 25, within four months of their leaving school or after they become unemployed, with a good-quality offer of employment, continued education, an apprenticeship or a traineeship.
Member States are responsible
As a recommendation, the Youth Guarantee is a legal act, but it is not legally binding in its effect. The (main) responsibility for the action needed in the field of youth unemployment lies with the Member States. The necessary structural reforms include, for example, strengthening public employment services and reforming vocational education and training systems.
There is no doubt that the individual measures for implementing the Youth Guarantee are going to be costly for the Member States at the initial stage. But doing nothing may very well prove to be far more expensive in the long term. The European Foundation for the Improvement of Living and Working Conditions (Eurofound) estimates the economic damage caused by youth unemployment through unemployment benefits, earnings and tax losses at €150 billion for 2011. However, we must not lose sight of the personal impact – which cannot be quantified in monetary terms – on the young people and young adults who are affected.
The Member States have presented their plans to implement the Youth Guarantee. The Commission monitors the implementation of the Youth Guarantee programmes within the framework of the European Semester.
Financial support from the EU
Substantial financial support is provided to Member States by the European Social Fund (ESF), one of the EU’s structural funds. The focus of the ESF is on improving the opportunities for employment and education in the EU, and a further aim is to improve the situation of vulnerable people for whom poverty is a very real risk. In accordance with the current ESF Regulation, the intervention area includes the sustainable integration of young people into the labour market and investment in education, training and vocational training for skills and lifelong learning.
In the new programming period (2014–2020), the ESF has available funds amounting to €80 billion. Each Member State agrees with the Commission on one or more operational programmes (OP) to make use of the funds during the programming period. In the OP the Member States propose the specific implementation of the funding priorities for the relevant province or region. After approval by the Commission, the funds can be utilised.
Employment initiative for young people
To increase EU funding for the regions that are most affected by youth unemployment, the Youth Employment Initiative (“YEI”) was launched. It is regulated by Chapter IV of the ESF Regulation. The target group consists of all young unemployed or inactive people aged under 25 who live in the eligible regions (meaning the regions at NUTS 2 level with a youth unemployment rate of more than 25% in 2012) who have no job and are not in any education or training schemes, regardless of whether or not they are registered as unemployed. However, Member States may extend the target group to young people under 30. The YEI specifically aims at supporting individuals. Thus, measures such as initial work experience placement, supporting young entrepreneurs in starting a business, and high-quality education and training can be promoted.
In the period 2014–2020, the YEI is being supported with €6 billion from the EU budget (50% through targeted investments from the ESF, 50% from a special “youth employment” budget line for 2014–2015 under Sub-Heading Ib “Economic, social and territorial cohesion” in the Multiannual Financial Framework).
Sluggish start for the employment initiative
However, implementation of the YEI has been slow so far. Recently, experts from the Commission and the Member States met for a seminar to jointly plan the actions financed by the YEI so that the disbursement of funds to all eligible Member States can begin as soon as possible. The first Member State to submit its operational programme for the use of funds from the YEI was France. It is now receiving a total of €620 million from the YEI and the ESF. Italy’s OP, which is mainly for implementing the Youth Guarantee, was approved in July. Italy is receiving €1.1 billion in EU funds, which will be used for measures such as job placement, apprenticeship opportunities particularly for the youngest individuals, traineeships and the improvement of mobility.
Flanking measures at EU level
Against the background that effective systems of vocational education and training, particularly those with a strong work-based component, facilitate young people’s transition from school to work, the Commission launched two initiatives to supplement the Youth Guarantee.
- European Alliance for Apprenticeships
The European Alliance for Apprenticeships was founded on 2 July 2013 as a platform to bring together actors from the sectors of employment and education. The aim is to improve the quality of what is on offer and the attractiveness of apprenticeships throughout Europe and to change attitudes towards this form of learning.
- Quality Framework for Traineeships
On 10 March 2014, the EU Council adopted the Recommendation on a Quality Framework for Traineeships. This aims to increase transparency concerning the conditions of traineeships, e.g. through the use of written traineeship agreements which, in addition to describing the learning content, should also include information on the working conditions (limited duration, working hours, remuneration or reimbursement of expenses, social security). Although the quality framework is to be welcomed, close monitoring will be required to see whether, in future, “cheaper” traineeships replace permanent employment contracts.
As further accompanying measures, the Commission is focusing on labour mobility, especially though EURES, the European network for promoting cross-border mobility in the labour market. The mobility programme “Your first EURES Job” is designed to help young people aged 18–30 to find a job, an apprenticeship or a traineeship in another EU Member State.
In recent years, the EU has devoted major efforts to tackling high youth unemployment and creating opportunities for young people. However, the structural reforms which are needed in many places will only show their results in the long term. What we must not lose sight of, though, is the possible impact of the current situation on the psychological well-being of the young people concerned. As Pope Benedict XVI notes in his social encyclical Caritas in Veritate: “Being out of work or dependent on public or private assistance for a prolonged period undermines the freedom and creativity of the person and his family and social relationships, causing great psychological and spiritual suffering.”
Translated from the original text in German