3 Ways We Can Solve Global Youth Unemployment

To tackle growing global unemployment rates, we need to address it from three levels: employer, government and international community.

headshotThousands of Taiwanese students occupied the parliament to protest the Taiwanese government’s free trade agreement with China. The students are worried that the agreement will allow Beijing have a more influential role and that Chinese immigrant labor will flow into Taiwan.

In Madrid, student protestors in what has been described as a “Dignity March” demonstrated against austerity measures and other government policies. Spain’s youth unemployment rate is more than 50 percent.

Just over three years ago, Arab youth took to the streets demanding a better life and future. If we look closely, these trends share a current source: The global youth unemployment crisis. The youth is society’s underdog.

In 2013, youth comprised 17 percent of the global population; but made up 40 percent of unemployment. More than 2 million youth earn less than $2 per day. With less experience and fewer skills than many adults, young people encounter difficulty finding work, according to the United Nations. What’s worse, young people in economic slumps are always “last in” but “first out.”

In the past, education was key to decent job. But a grand education doesn’t guarantee a decent job today.

In Tunisia, 40 percent of graduate student are unemployed compared to 24 percent of non-graduates. Long unemployment will have negative effects on the psychology of youth. Indeed, young people are justified to be angry with the governments. The governments could have done more on comprehensive policy framework, but only four countries in the world have an action plan so far. If governments don’t address this issue promptly and effectively, youth unemployment will cause millions of our tax dollars.

To address this issue, we have to acknowledge that from supply sides, young people lack information, connections and skills. From the demand side, we must solve the problem of businesses that would rather poach employees from other companies instead of employing and training people who lack skills and experience. So if we are going through this issue, we need to address it from three levels: employer, government and international community.

1. For the employer:  Collaboration with high schools might be a good start. Education is not enough for the needs of labor markets. To fill this gap, employers can consider training-to-employment programs, which can ensure they have the employee they need. Employers can also provide career and labor market information for young job seekers by participating in campus recruitment. Young people will be given the right skills and access to the job market.

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2. For the government:  Officials should demonstrate a shared vision, clear objectives and support youth with resources. To begin with, government can promote positive images on vocational education and apprenticeship. Only two countries that do this are Germany and Denmark.

Their youth unemployment rate is 7 percent and 14 percent, much lower than the EU average of 24 percent. Also, government should expand the number of job creators such as youth entrepreneurship. Youth entrepreneurship in particular can directly impact potential young business starters themselves, while spreading positive employment impacts among their peers and their communities.

According to the World Bank’s Enterprise Surveys, small-scale entrepreneurs (5-19 employees) are the primary engines of job growth in developing countries. In the United Kingdom, there’s Start Up Loans, a federally funded plan to provide loans and mentors for entrepreneurs. However, without the right legislative, fiscal and financial conditions, these new companies will not go the distance.

3. For the international level: International agencies such as United Nations should adopt a comprehensive policy to make youth employment a national priority. TEN YOUTH Program, sponsored by the World Economic Forum, is encouraging leading global firms to help young job seekers. These firms were helping influential international companies to purchase goods and services from youth-owned small and medium size enterprises. Youth trade, another youth program in Africa, connects young entrepreneurs with markets for their products.

Of course, youth should take the biggest responsibility in helping themselves. Youngsters can capitalize on free online courses to expand their knowledge and skills. And there is room for optimism.

In Spain, entrepreneurship among young people has been on the rise. The number of companies created have increased by 8.2 percent in the first half of 2013 compared with the same period in 2012. Youth have the ability to be the solution to joblessness and not just the victims. For them, “It was the best of times, it was the worst of times.”

Chia-an Chan graduated from New York University International Relations program. His strength is on Political Risk Analysis, Governance and International Trade. Read other articles by Chia-an.