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Blog 25th May EL

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'Scarring' vs Permanent Loss – The Two Youth Related Dangers on the Greek Labour Market Today The austerity and economic stagnation during the recent crisis, and mainly during the period 2010-2012, affected strongly all Greek youth, independent of gender, educational status or regional concentration. Before the crisis there were traces of different patterns of youth unemployment by region and gender in relation to the economic specialization across the territory of the country. These patterns we
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  'Scarring' vs Permanent Loss – The Two Youth Related Dangers on the Greek Labour Market Today The austerity and economic stagnation during the recent crisis, and mainly during the period 2010-2012,affected strongly all Greek youth, independent of gender, educational status or regional concentration. Beforethe crisis there were traces of different patterns of youth unemployment by region and gender in relation to theeconomic specialization across the territory of the country. These patterns were generally abolished during thehectic development of the crisis and the discrepancies were shrinked due to faster deterioration of someregions which previosuly enjoyed more intensive investments. Thus, all youth categories in Greece today facea dramatic increase of youth unemployment rate (YUR). Partially due to the development from previousperiods, the female young workers and foreign young workers remain among the most seriously exposed toyouth unemployment groups.The official statistics in Greece defines youth within a boundary 15-29 years of age. If applying the EUdefinition of youth, considering the age category 15-24 years old, youth unemployment scores much higher share of unemployed youth per youth labour force. At the last quarter of 2011, the youth unemployment rate for 15-24 years of age was 50%, compared to almost 40% for the age category 15-29 years old and average 21%for the country. This record high youth unemployment for persons between 15-24 years of age, however,happens on the background of a past period of relativelly well-managed youth unemployment for this group.For the period 2000-2010, the age category 15-24 were highly involved in education and had a relativellyimproving NEET (i.e. discouraged inactive youth) sub-section. Meanwhile, during the crisis, the age category25-29 years old shows almost the same pace of increasing unemployment rate as youth at 15-24 years of age. Thus although scoring about 9% less than youth unemployment rate for the age category 15-24, theemployment rate for young Greek adults between 25-29y also suffered a dramatic fall from 10% for the period2010-2011, compared to the change of only 6% for the overall population. The age category 25 – 29 years oldis also the modern-time-Europe age of education-to-work transition period for young highly educated workersas new entrants on the labour market (Dietrich 2005). This means, that in Greece the most skilled young adultswho are in the generally sensitive education-to-work transition period suffer also the strongest blows fromfiring and joblessness during the current crisis in a pace more similar to youth unemployment rather than to theaverage for the rest of the adults. Yet, while the youth (15-24) have certain chances for education involvementand requalification, the already highly qualified young adults (25-29) are exposed to the effect of the crisiswithout significant sources for support. Thus a double treath for „scarring“ and hampering the employmenthistory of the young generation 15-29 in Greece exists: once due to being the group which looses jobs athighest speed and second due to the additional exposure of the generally sensitive education-to-job transitionperiod group (i.e. young adults 25-29 years old).These economic tendencies of youth unemployment happen on the background of a particular situation withyouth entrepreneurship in Greece. Greek youth who are involved already in entrepreneurship account 1%more as percentage in comparison to their EU27 peers. The group of already enterprenurially active youth andthe youth willing to involve into entrepreneurship, taken together, represent the same share of Greek youth asthe share of those European youth willing to deal with entrepreneurial activity in EU 27. However, while EU27enjoys a poket of 10% still indetremined youth who might possibly be stimulated to enter into entrepreneurialactivity, the Greek youth are already largely demotivated. The young peoplel in Greece who are inactive but notfirmly disinterested in entrepreneurial activity is less than half the EU27 average – scoring only 4%. This meansthat entrepreneurship, which is believed to be an important engine for self-employment, creativity and growth,is less attractive for Greek youth under the current severe austerity and crisis situation – half less motivationbeing available for such activity in Greek youth than in EU27 youth.Moreover, unemployed Greek youth are not only growing in numbers and largely demotivated to undertakeentrepreneurship and self-employment opportunities, but are also growingly dissatisfied with the inability of thelocal institutions – educational and vocational training ones – to provide them sufficient support in the situationof the current crisis. This on the one hand is plausible to lead to worsening of the situation with the NEET or discouraged unemployed youth. On the other hand, 64% of Greek youth are actually expressing differentdegrees of willingness to emigrate from the country. This number is over 10% higher than the EU27 average. Inaddition, the intention for emigration among Greek youth seems to be prevailingly long term oriented, thosewilling to emigrate for a long period being 10% more than the short-term oriented ones. Meanwhile, the shareof young population in Greece is declining.The summary of the above observations opens a two fold line for further analysis and policy actions:1)Negative convergence of youth unemployment between regions and genders in Greece registeres anoverall worsening of the situation for young Greek workers. This necessitates immediate structuralchanges to support job-creation and entrepreneurship targeted at young people. Also, special support  measures are required for the youth category 25-29 years old, who are the group exposed to fastestunemployment growth among adults and are most seriously threatened by experiencing „scarring“ for their whole employment history, resulting in low wages and poor quality of work contracts track record.2)Meanwhile, the country faces the treath to lose the most highly potential among its youth due to theself-selection process during emigration. Those who will remain inside the country will face highinternal competion for job openings. The possible result is ethic tention among Greek youth whichalready started escalating in a socio-economic crisis in the country, topped with the treath of depopulation of those areas with highest female unemployment rates.In short, unless we see immediate measures for: a) job-creation targetted at young people, b) empowering theGreek youth unemployed in age category 25-29 years of age, and c) special measures for female youthunemployed, Greece faces the real danger of scarring and literally losing a whole generation of youth. Thisgeneration is meanwhile the one which could and should be the main resource for economic recovery of thecountry through enterpreneurship and creativity, on the background of the world economic crisis and agingproblems across all Europe.
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