The United Nations agency International Labour Organization
(ILO) recently gave a dire outlook on unemployment in the Eurozone. If
policymakers do not complement their current austerity measures
with smart labor market incentives another 4.5 million jobs may be
lost over the next four years.
This would also affect young people who face unfavorable job
markets, especially in southern Europe. To counter this the ILO
recommends implementing Scandinavian type youth guarantee programs.
In Sweden and Finland young unemployed citizens enter coaching
programs which help them with finding a job or opportunities for
academic or vocational education. At a cost of €21 billion (0.45%
of Eurozone government spending) such programs could be implemented
Sweden: the case of a personalized youth guarantee
"Following a period of unsuccessful job search, all young people
in Sweden are offered youth specific activities within the "Job
guarantee for young people". The programme aims to provide special
measures and activities for the participant to enable them to get a
job or return to education as soon as possible. To be eligible,
youth aged 18 to 24 need to be registered with the Public
Employment Service (PES). After 90 days of unemployment, the young
jobseeker is referred to a programme for a period of four
During the first three months, the activities of the job
guarantee include an in-depth assessment, educational and
vocational guidance and job search activities with coaching.
Thereafter, these activities are combined with work experience,
education and training, grants to business start-ups and
employability rehabilitation efforts.
During the in-depth assessment it is also decided whether the
participant's needs can best be met by the Employment Office or
with an external complementary provider. A young person can
participate in the job guarantee for up to 15 months. The cost of
the job guarantee in 2010 was less than 6,000 euros per
participant. It is estimated that 46 per cent of the young
jobseekers had successful outcomes as a result of the guarantee.
Finland: the case of effective and speedy interventions
in support of youth
"In Finland, the youth guarantee scheme was established in 2005
and revised in 2010. The project targets young people below age 25
who are finishing school and do not have a job or a place in an
education programme. From 2013, however, the programme will be
expanded to young graduates under age 30.
The Finnish programme shares the aim of the Swedish one - to
bring unemployed and inactive youth back to employment - and has
also the PES at the centre of the implementation of the scheme.
More specifically, it includes a personal development plan which is
set up within the first three months of unemployment. Within this
time, the registered youth has to be offered a job, a place in
either academic education or vocational training, or any other
activation measure deemed necessary to improve job prospects.
The difference with the Swedish system is the speed of
intervention. In Finland, intervention under the youth guarantee
occurs immediately when the youth registers as unemployed and
before a maximum period of three months each youth has to be placed
in either a job or education."
€21 billion for a Eurozone-wide program
These programs had a success rate of 46% and over 80%,
respectively. "Implementing such a young guarantee programme across
the Eurozone would not exceed 21 billion euros - which represents
around 0.45 per cent of Eurozone government spending, a modest
figure vis-à-vis expected benefits."
Youth unemployment is currently at about 6 million in the
Eurozone. Assuming a more conservative Swedish success rate of 46%,
this would mean that almost 3 million unemployed young people could
be reintegrated into the job market and the education system. A
Finnish outcome would raise this number to over 4.8 million.