More must be done to provide youth with the skills and help they need to get a better start in the labour market and progress in their career. Sharp increases in youth unemployment and underemployment have built upon long-standing structural obstacles that prevent many youth in both OECD countries and emerging economies from making a successful transition from school to work.
Key elements of the OECD Action Plan for Youth
- Tackle the current youth unemployment crisis
- Tackle weak aggregate demand and boost job creation
- Provide adequate income support to unemployed youth until labour market conditions improve but subject to strict mutual obligations
- Maintain, and where possible expand, cost-effective active labour market measures
- Tackle demand-side barriers to the employment of low-skilled youth
- Encourage employers to continue or expand quality apprenticeship and internship programme
- Strengthen the long-term employment prospects of youth
- Strengthen the education system and prepare all young people for the world of work
- Strengthen the role and effectiveness of Vocational Education and Training
- Assist the transition to the world of work
- Reshape labour market policy and institutions to facilitate access to employment and tackle social exclusion
Read more about The OECD Action Plan for Youth - Giving Youth a Better Start
YOUTH AND SKILLS
Fostering youth employability re-quires a comprehensive and forward-looking skill strategy; however efforts to achieve a better match between the skills youth acquire at school and those needed in the labour market may not per se be sufficient to improve labour market prospects for all youth.
Read The OECD Skills Strategy
YOUTH AND ENTREPRENEURSHIP
40% of youth indicate an interest in self-employment and governments have a substantial number of programmes in place to help them start businesses. And while youth entrepreneurship is unlikely to be a panacea for solving the youth unemployment problem, it can be a part of the response.
To maximise effectiveness and efficiency, policy should target resources on young people with the best chance of success, provide sufficient support to allow them to start businesses outside of low entry barrier but high competition sectors, and provide integrated packages of complementary support rather than one-shot instruments.
Read a Policy brief on Youth Entrepreneurship
YOUTH AND FINANCIAL EDUCATION
Financial literacy is a core life skill for participating in modern society. Children are growing up in an increasingly complex world where they will eventually need to take charge of their own financial future.
National surveys show that young adults have amongst the lowest levels of financial literacy. This is reflected by their general inability to choose the right financial products and often a lack of interest in undertaking sound financial planning. Even from an early age, children need to develop the skills to help choose between different career and education options and manage any discretionary funds they may have, whether from allowances or part time jobs.
Read about our work on Financial education in schools
About 40 million young people in OECD countries, equivalent to 15% of youth aged 15 to 29, are not in education, employment or training, so-called NEETs. Two-thirds of them are not even looking for work. While up to 40% of all youth experience a period of inactivity or unemployment over a four year period, for half of them this period will last a year or more and may lead to discouragement and exclusion.
Almost 1 in 10 jobs held by workers under 30 were destroyed during the crisis. In Spain, Greece and Ireland, the number of employed youth halved between 2007 and 2014. Across the OECD, despite the recovery, the youth employment rate has stagnated since 2010 and today is still below pre-crisis levels.
The high number of NEETs also represents a major economic cost, estimated at between USD 360 billion and USD 605 billion, equivalent to between 0.9% and 1.5% of OECD GDP.