This chapter examines the situation of young people not in employment, education, or training (NEET) in Greece. It analyses active labour market policies, including training programmes and wage subsidy schemes, and assesses the tax-benefit system and unemployment insurance framework, discussing how these shape incentives and outcomes for young jobseekers' labour market integration.
Challenges for Young People in Greece to Reach Financial Independence
Abstract
Not all young people make a successful transition from education to work, and some end up in unemployment or inactivity. The share of young people who are not in employment, education, or training (NEET) in Greece has almost halved over the past decade, from 29.2% of all 15‑29 year‑olds in 2013 to 15.6% in 2024 (Figure 3.1, Panel A). Despite this improvement, the NEET rate among young people in Greece is still considerably above the OECD average of 12.8% and the EU target of 9% (European Commission, 2021[1]). The NEET rate is particularly high among the age group 25‑29, for whom Greece ranks seventh highest among OECD countries (Figure 3.1, Panel B).
Splitting the group of NEETs into those who are actively looking for a job (unemployed) and those who are not actively looking for a job (inactive) reveals that a large part of NEETs in Greece is unemployed. In 2024, 7.9% of all young people were classified as unemployed NEETs and 7.7% as inactive NEETs (Figure 3.2). Comparing the relative importance of both groups in Greece and the OECD reveals the weight of unemployed NEETs over inactive NEETs is considerably larger in Greece than in other OECD countries, where the unemployed represent 4.3% on average.
Source: OECD Youth Database, https://webfs.oecd.org/Els-com/youth/OECD-NEET-Rate-1529s-web.xlsx.
To effectively deliver these wide‑ranging services, DYPA operates through a carefully structured multi-tiered system designed to reach jobseekers throughout Greece. At the top level, a central DYPA office provides strategic direction to eight regional directorates. These directorates, in turn, co‑ordinate 120 local Employment Promotion Centres, which serve as the critical interface between DYPA and jobseekers. The local centres provide individualised counselling, job matching services, and training referrals, while working within the broader policy framework established by the Ministry of Employment and Social Insurance.
NEET rate for 15‑29 year‑olds, by labour force status, 2024
Source: OECD Youth Database, https://webfs.oecd.org/Els-com/youth/OECD-NEET-Rate-1529s-web.xlsx.
NEET rate for 15‑29 year‑olds, by educational attainment, 2022
Note: The OECD average is the unweighted mean of all countries shown in the figure. Data are not available for Australia, Colombia, Japan, and Korea.
Source: OECD calculations based on Labour Force Surveys (LFS).
Women in Greece are slightly more likely to be NEET, with a rate of 16.4% compared to 14.8% among men in 2024. Furthermore, young people with upper-secondary, post-secondary, or tertiary education are more likely to be NEET in Greece than those with lower educational attainment, whereas the opposite applies in most other OECD countries (except for Czechia) (Figure 3.3). In particular, the NEET rates among young people with upper- or post-secondary education and those with tertiary education were around 21% in Greece in 2022, compared to 7% for those with below upper secondary education. In contrast, the average NEET rate for young people in the OECD was 14.7% among those with a low level of education, compared to 12.9% among those with a medium level of education and 9.5% among those with a high level of education.
3.2.1. Set-up of active labour market policies
The Greek Public Employment Service (DYPA, its acronym in Greek – formerly OAED) is responsible for designing the operational model and implementing the delivery of active labour market policies (ALMPs) in the country and supports unemployed (young) people with a comprehensive range of employment services. While most OECD public employment services focus primarily on job placement and training, DYPA operates with an exceptionally broad mandate. The mandate includes managing 13 different unemployment insurance schemes, providing vocational training through its own centres, and overseeing various social services ranging from social tourism to children’s camps and day nurseries. The approach reflects Greece’s strategy to address unemployment through multiple, interconnected support mechanisms.
Despite Greece’s high unemployment rates, expenditure on ALMPs is significantly lower than that of many other OECD countries. In 2022, Greece spent only 0.25% of GDP on ALMPs, below the OECD average of 0.29% (Figure 3.4). Unlike in many other OECD countries where the largest spending category is often training (above 60% of total spending on active labour market policies in Austria, Denmark and France), respectively 64% and 21% of spending in Greece is allocated to direct job creation and employment incentives. On the contrary, placement services and training only accounted for 2% each of Greece’s ALMP expenditures, compared to 17% and 33% among OECD countries respectively.
Recognising the low ALMP spending in a climate of high unemployment, Greece launched the comprehensive “Jobs Again” reform in April 2022 (Konstantinidou, 2022[2]; OECD, 2024[3]). The reform aimed to modernise DYPA, enhance support for jobseekers and employers, and align public employment services with the evolving needs of the labour market.
A key structural change was streamlining the organisation’s governance by reducing the size of DYPA’s tripartite board of directors, enabling faster and more effective decision making. The reform included modernizing the organisational structure while maintaining DYPA’s high-level governance model. While these changes improved operational efficiency, DYPA is working to establish new ways of involving additional stakeholders and experts in its decision-making process to ensure decisions meet labour market needs.
Another cornerstone of the reform, initially accelerated by the COVID‑19 pandemic, was the digital modernisation of DYPA. New digital tools have been introduced, including the digital DYPA card, the digital unemployment registry and digital individual action plans, designed to help unemployed persons exercise their rights and receive more individualised services. The reform also overhauled administrative processes through integrated IT systems that better monitor employment outcomes and support better policy evaluation. Finally, an integrated data system facilitates information exchange across various government databases and consolidates employment, taxation, and social security records. This integration allows for a more comprehensive and efficient approach to jobseeker support and labour market analysis, supporting DYPA’s shift towards data-driven performance management.
Active labour market policy (ALMP) spending as a percentage of GDP, 2022
Note: OECD data on public expenditure on ALMPs are based mainly on information about individual labour market programmes appearing in state budgets and the accounts and annual reports of bodies implementing the programmes. Training includes targeted institutional and workplace‑based training of targeted persons. Employment incentives include incentives where the employer covers the majority of the labour cost, and job rotation/sharing schemes where a targeted person substitutes for an employee for a fixed period. Direct job creation relates to new jobs where the labour cost is majority funded by public funds for a limited period. Placement and related services are typically provided by the public employment service or other publicly financed bodies. They include employment counselling and case‑management, referral to opportunities for work, information services and so on. Start-up incentives encourage targeted persons to start businesses or to become self-employed.
Source: OECD (2025[4]), OECD Labour Market Programmes Database, https://doi.org/10.1787/data-00312-en.
A third major improvement introduced under this reform was training provision. In addition to providing training via their own VET institutions (see Section 1.5), DYPA became responsible for developing and implementing short-term training programmes aimed at upskilling and reskilling both employed individuals and jobseekers. For this task, DYPA collaborates with independent training providers to deliver two different subsidised programmes offering reskilling in digital and green skills for 120 000 unemployed people and upskilling in the same area for 150 000 employed persons. These programmes, funded by the Recovery and Resilience Facility (RRF), should also introduce the concept of “payment by results” in DYPA’s operational model. While not yet fully operationalised, both training providers and participants would be incentivised to achieve specific outcomes, such as completing the programme and improving employment rates, and an accountability mechanism would aim to reduce dropout rates and enhance the quality of training, ensuring that participants gain practical skills that improve their employability.
Finally, the reform aims at strengthened service provision through the integration of digital tools, streamlined administrative procedures, and tailored counselling. Jobseekers, in particular young people, women, long-term unemployed people and other groups in vulnerable situations, now have access to more targeted support. DYPA’s reform also emphasises the importance of evidence‑based policymaking, with the introduction of new profiling tools to better match jobseekers with ALMPs that align with their needs.
One of the most pressing challenges facing DYPA for reaching the full potential of the reform is its limited counselling capacity (OECD, 2024[3]). Counsellors face high caseloads, making it hard to meet jobseekers’ needs and provide tailored support. Despite doubling the number of counsellors in 2022, caseloads remain extremely high at around 1 847 jobseekers per counsellor – 10 to 20 times higher than in well-performing ALMP systems in other OECD countries where caseloads typically range from 100‑150 jobseekers per counsellor.
3.2.2. Youth Guarantee
The Youth Guarantee is a key initiative of the European Union launched in 2013 that aims to support young people’s transition into the workforce (European Union, 2013[5]). At its core, the programme ensures that individuals under 25 receive opportunities within four months of becoming unemployed or completing their education, whether through job placements, further education, apprenticeships, traineeships, or vocational education and training (VET). The initiative builds on ALMPs, career guidance, and partnerships with employers and educational institutions to deliver practical experience and skills development, while youth employment subsidies and tailored support help ensure that vulnerable groups, particularly those at risk of exclusion, remain connected to the labour market. Its flexibility allows each EU Member State to adapt implementation to local contexts, making it a dynamic and inclusive strategy for addressing youth unemployment (European Comission, 2015[6]).
In Greece, the Youth Guarantee was formally initiated when the country submitted its Youth Guarantee Implementation Plan in December 2013, later updated in May 2014 and November 2018 (Ministry of Labour, Social Security and Social Solidarity, 2018[7]), marking Greece’s first co‑ordinated effort to address youth unemployment. The then Ministry of Labour, Social Security, and Social Solidarity1 was responsible for developing the national strategy, aligning it with European Union guidelines, and overseeing its execution. The Employment Directorate of the Ministry oversees, as the national co‑ordinator for the Youth Guarantee, co‑operation across key institutions like DYPA, other ministries (Education, Tourism, and Culture), local authorities, and social partners (European Commission, 2020[8]).
Between 2018 and 2020, Greece implemented a comprehensive set of interventions funded with approximately EUR 574 million, including EUR 78.9 million from the Youth Employment Initiative (YEI), matched by an equal amount from the European Social Fund (ESF). During this period, the plan expanded its target group to include those up to 29 years old, shifting its strategic focus to creating quality employment opportunities and addressing brain drain. Notable programmes included an employment initiative for 15 000 youth aged 18‑29 (EUR 100 million), specialised ICT sector training for 1 200 participants (EUR 9 million), and entrepreneurship programmes for 2 500 young people (EUR 43.4 million). Additional initiatives targeted vulnerable groups, offering comprehensive support for 4 500 low-qualified young people (EUR 25.5 million) and 3 000 young people with disabilities (EUR 27.1 million), strengthened by the establishment of the Labour Market Diagnosis Mechanism in 2018 (Ministry of Labour, Social Security and Social Solidarity, 2018[7]).2
Evaluating the implementation of the Youth Guarantee, the European Commission (2020[9]) noted that the Youth Guarantee reached many young people in Greece, with 62% of NEETs aged 15‑24 registered in the preparatory phase in 2018 (an increase of 12 percentage points (p.p.) from 2017 and well above the EU average of 39%). However, implementation challenges remained evident: 61% of those registered waited for an offer for more than four months, and only 31% of those leaving the Youth Guarantee in 2018 received offers within the four‑month target, well below the EU average of 47%. Despite these obstacles, the Youth Guarantee also showed positive outcomes, with 47% of participants known to be in a positive situation six months after leaving the programme in 2018, slightly behind the EU average of 50%.
Building on the progress, Greece adopted the Reinforced Youth Guarantee framework in October 2020, as part of its National Strategy for Social Inclusion and Poverty Reduction (Ministry of Labor and Social Affairs, 2022[10]). This new phase prioritised intensive and personalised outreach to vulnerable NEETs aged 15‑29 and enhanced co‑ordination between employment services, education providers, and social services. It emphasised sustainable labour market integration and social inclusion through measures such as optimizing the use of national and EU funding, targeting employability and social integration, and developing comprehensive monitoring systems via the Employment Committee (EMCO) in the European Semester framework.
As part of the Reinforced Youth Guarantee, Greece shifted its approach towards digital skills development, green jobs, and entrepreneurship opportunities, aligning with the EU’s twin transition priorities. The strategy also expanded apprenticeships and targeted marginalised groups, such as youth with disabilities, those from disadvantaged backgrounds, and individuals in rural areas. These improvements reflected Greece’s commitment to creating a more inclusive and tailored system of youth support, ensuring the continuity of the successful elements of earlier implementations (Ministry of Labor and Social Affairs, 2022[10]).
3.2.3. Training programmes
Training is a central and promising component of the Reinforced Youth Guarantee. The report by the OECD (OECD, 2024[3]) evaluated the impact of training and wage subsidy programmes on unemployed people in Greece and found that these programmes have a significant positive impact on employment outcomes, especially for young people.
Among the three training programmes assessed in the report, one provided ICT training to tertiary graduates aged 25‑29, benefiting approximately one thousand participants. The programme required individuals to have tertiary education and combined theoretical classroom education (two‑thirds of the programme time) with practical workplace experience through internships (one‑third of the time) over a 5‑7-month period, supplemented with career guidance and job search assistance. Participants received a training voucher worth up to EUR 2 990 (EUR 3 190 if they were retained by the same employer for six months), covering training, counselling, certification, and internship costs. Additionally, they were granted an allowance of EUR 2 800, which included education and traineeship subsidies.
The counterfactual impact evaluation undertaken by the OECD (2024[3]) shows that two years after entering the training programme, men under 30 are 19 p.p. more likely to be employed than their non-participating peers, while women in the same age group see a 16 p.p. increase in their employment. Additionally, ICT training specifically supports young participants’ upward occupational mobility, with those aged 25‑29 receiving a 6‑p.p. boost in average occupational wages compared to their control group counterparts. The evaluation also found broader effects across all age groups: training leads to a reduction in registered unemployment (five p.p. lower after one year, two p.p. after three years) and participants experience greater job stability and higher earnings (66 more days worked and EUR 1 500 more earned, on average, cumulatively after three years).
The success of the training programmes has influenced DYPA’s new strategy, which includes a stronger focus on digital skills training for young people as part of Greece’s implementation of the National Recovery and Resilience Plan 2021-2026. Under this initiative, DYPA’s goal is to target 500 000 individuals certified in digital skills. In addition, 36 000 Greeks have completed training programmes offered by major technology companies through DYPA collaborations, reflecting the digitalisation transition and ensuring that they possess the skills needed to compete in a rapidly evolving job market (Digital Skills & Jobs Platform, 2024[11]). However, despite positive reactions collected via participant surveys by the training providers at the end of the training programmes, doubts about the quality of the provided training programmes were expressed during the youth consultation organised by the OECD in October 2024. Several participants mentioned how easy it was to follow the training programme online simply to benefit from the payment given to participants (EUR 400 or EUR 750 depending on the training programme), while the skills learned were not necessarily directly applicable or useful to find a job. More systematic and independent evaluations of the impact of training programmes on young people’s labour market integration would therefore be welcome, to avoid misuse.
3.2.4. Wage subsidies
Wage subsidy schemes are another useful policy tool to facilitate the labour market integration of unemployed young people. In recent years, Greece has implemented several reforms to its wage subsidy programmes to better target the provided support. Compared to their features prior to July 2020, and as part of the “Jobs Again” reform, employers can no longer propose candidates they would like to hire but are obligated to choose from a list of candidates proposed by DYPA. Programmes no longer impose retention requirements at the end of the wage subsidy period, recognising that one of the important functions of subsidised employment is to test the suitability of a job match in practice. The administrative burden of the programmes has also been reduced, for example, by only verifying whether an employer meets the subsidy eligibility criteria after a suitable candidate has been identified. These reforms aim to improve the effectiveness and efficiency of wage subsidies in connecting unemployed youth with job opportunities (OECD, 2024[3]).
The different wage subsidy programmes in Greece vary in duration, subsidy rates, and target groups, with higher subsidies allocated to vulnerable jobseekers (Table 3.1). A key initiative for young people within this framework is the Programme of Grants to Enterprises for the Employment of 8 000 unemployed young people, which requires participants to have been unemployed for at least one month before eligibility. Under this scheme, employers are reimbursed 75% of wages for 12 to 15 months, making it one of the most substantial employment incentives for companies to hire young workers.
Source: Information provided by the Greek Public Employment Service (DYPA).
The counterfactual impact evaluation undertaken by the OECD (2024[3]) indicates strong positive employment outcomes for wage subsidy programmes in Greece, with participants (of any age) nearly twice as likely to be employed three years after entering the programme compared to non-participants. At 12 months, 86% of participants remained employed, and after 36 months, this figure stood at 59%, significantly outperforming the 32% employment rate of non-participants. Moreover, young workers who participated in these schemes were employed for 524 more days over a three‑year period than those who did not receive subsidies. For men under 30 in particular, the programme contributed to occupational mobility, allowing them to enter better-paying jobs, with salaries 2% higher than those of non-participants. Nevertheless, while wage subsidies effectively boost short- and medium-term employment, they frequently result in temporary rather than permanent career opportunities. It should also be kept in mind that the OECD report evaluated the programmes with its specificities prior to the 2020 reform, when employers were still able to propose their own desired candidates, hence leading to an overestimation of the positive effects and larger deadweight losses (which occur when subsidies support hiring that would have occurred without them).
The presence of undeclared work further complicates the implementation and evaluation of both training and wage subsidies. For training programmes, the immediate earnings from informal work often appear more attractive to young people than participating in training, despite the latter’s potential for better long-term formal employment prospects. On the wage subsidy side, employers may avoid participation to escape the increased scrutiny that comes with programme monitoring and compliance requirements. Moreover, many individuals may be working informally while remaining registered as unemployed to maintain access to benefits, making it difficult to accurately assess the true impact of both types of programmes. These dynamics particularly affect young workers, who are more vulnerable to becoming trapped in informal employment arrangements.
Income support plays a crucial role in supporting young people as they navigate the precarious employment and volatile earnings that often accompany the transition to work (OECD, 2024[12]). For instance, by insuring recent labour market entrants against income shocks, unemployment insurance facilitates the move towards financial independence and assuages the reliance on familial support. In addition, minimum income benefits can help to protect those without access to unemployment insurance or familial support against the risk of falling into poverty by providing a minimum level of social assistance.
Young people tend to have higher poverty rates than their older peers. In Greece, the poverty rate for 18‑25 year‑olds equalled 15.9% in 2023, compared to 11.5% for 26‑65 year‑olds (OECD averages are 12.3% and 9.7% respectively) (Figure 3.5).
3.3.1. Types of income replacement benefits
In Greece, the unemployment benefits system does not distinguish between young and older jobseekers. In fact, there are no special rules for jobseekers under 30 years of age in terms of eligibility, duration of benefits or level of benefits. However, as young adults have in general shorter and more fragmented contribution spells, their access to unemployment benefits can be, de facto, more difficult. Box 3.1 provides a description of the most important income replacement benefits, including different types of unemployment benefits and the Guaranteed Minimum Income (GMI).
The Greek tax-benefit system provides valuable support to young jobseekers and their families, but functions more as a collection of independent schemes addressing different needs, rather than as a coherent and co‑ordinated framework addressing the needs of young people as a whole. The rest of this section provides an overview of the main sources of income support available to young jobseekers in Greece and their effects on jobseeker behaviour. Using OECD TaxBEN simulations (see Annex A), it examines the adequacy of the overall income support package for young adults, both with and without children, factoring in family and rent allowances, as well as the work incentives embedded in the tax-benefit system.
Percentage of persons living with less than 50% of median equivalised disposable income, by age group, 2023 or latest year
Note: The poverty rate is measured as the share living under the poverty line, set at 50% of the median disposable income for each country, expressed in p.p. OECD is the unweighted average of all countries showed on the figure. The latest available data refer to 2023 for all countries except Costa Rica (2024); Chile, Denmark, Germany, Hungary, Israel, Korea, Mexico, New Zealand, Norway, Switzerland and Türkiye (2022); Japan (2021); and Australia (2020).
Source: OECD Income Distribution Database (IDD), http://data-explorer.oecd.org/s/fx.
Unemployment benefits
The main contributory benefits in Greece are the Unemployment Insurance Benefit, the Unemployment Insurance Benefit for Seasonal Workers, and the Unemployment benefit for long-term unemployed. In 2024, a further means-tested benefit, the Special Allowance for Vulnerable Social Groups, was introduced to target specific population groups such as former convicts, victims of violence, women victims of gender violence and some lone parents.
The majority of young jobseekers who benefit from unemployment support in Greece receive either the primary Unemployment Insurance Benefit or the Unemployment Insurance Benefit for Seasonal Workers. As of end 2025, the main characteristics of these two benefits were:1
Persons applying to the Unemployment Insurance Benefit must have worked for at least 80 days per year in the last two years prior to their application and should also have i) worked for at least 125 days within the 14‑month period prior to the dismissal, or ii) at least 200 days within two‑years period prior to the dismissal. The duration of the benefit varies from five to 12 months depending upon the days worked before the job termination. A large majority of beneficiaries (all full-time workers and part-time workers with high salaries), receive a flat rate of EUR 510 / month, lower rates are awarded to some categories of part-time workers, who can receive either 50% or 75% of this amount. The benefit is subject to an increase by 10% for each dependent member of the beneficiary’s family and includes two extra payments per year (Christmas bonus and Easter bonus).
Persons applying for the Unemployment Insurance Benefit for Seasonal Workers will receive support depending on the number of employment days before the end or the termination of their contract. First-time applicants must have worked for at least 100 days within 14 months prior to the end of the employment relationship (if they have worked for one season) or at least 100 days within 12 months prior to the end of the employment relationship (if they have worked for two consecutive seasons), and 80 days per year during the two years prior to the application. The duration of the benefit is 80 days. Eligible seasonal unemployed with 100‑149 working days receive a subsidy for a duration of 80 days. However, if they have worked for 150‑230 days, they can opt between the standard Unemployment Insurance Benefit (explained above) and the benefit for seasonal workers.
Guaranteed Minimum Income
The Guaranteed Minimum Income (GMI) is a means-tested, non-contributory, and non-taxable welfare programme. It combines income support, complementary social services, and labour market (re)integration programmes. Despite being a minimum income programme, labour market integration of those able to work is among the primary goals of it – indeed since August 2018 all unemployed beneficiaries who are able to work must register as jobseekers within DYPA. As such, this report considers GMI as a non-contributory form of income support for jobseekers.
All adults over 25‑years-old, as well as adults up to 25‑years-old who are not attending education or VET, are eligible to the GMI, subject to a means and assets test. Young adults up to 25 years old attending education or VET are considered as dependent children, regardless of their place of residence. This means that a young jobseeker enrolled in education, even if living alone, is considered as a dependent member of their parent’s household when calculating the eligibility and amount of GMI.2
The GMI provides EUR 216 to single person households, increased by EUR 108 for each additional adult member of the household and by EUR 54 for each additional minor member (up to 18 years old) with the maximum of EUR 972 per month per household.
1. DYPA has worked on consolidating and streamlining a reform for the entire unemployment benefits system. To this end, as of March 2025, a pilot project has been implemented under the Greek RRP and an impact evaluation is underway. The new unemployment benefit model consolidates the existing standard Unemployment Insurance Benefit and the Unemployment benefit for long-term unemployed. It has three components: i) a fixed amount paid to all beneficiaries, ii) a variable component linked to the beneficiary’s insurance history and earnings, and iii) allowances paid to all beneficiaries, including Christmas and Easter bonuses and allowances for dependent children and single parents. The full nationwide rollout of the reform has started in April 2026. During the elaboration of this study the reform had not yet entered in force across the country in its final form, this section therefore focussed on the unemployment benefits in place in 2025.
2. Young people account for approximately 9% of primary GMI beneficiaries and 14% of total GMI beneficiaries (of whom 10% are aged between 15 and 24, and 4% are aged between 25 and 29).
Source: OECD Tax-Benefit Database (2025[13]), Country Note for Greece, https://www.oecd.org/content/dam/oecd/en/topics/policy-sub-issues/incomes-support-redistribution-and-work-incentives/TaxBEN-Greece-latest.pdf.
3.3.2. Benefit generosity
The Greek social protection system offers targeted benefits that, based on household income and circumstances, can supplement earnings from unemployment benefits and GMI. These targeted benefits notably include child allowances, which help offset the costs of raising children, and rent allowances, which assist with housing expenses. Using the OECD Tax-Benefit Model (see Annex A) this section examines the adequacy of the overall support package for young people.3
Greece stands out as one of the countries where the tax-benefit system offers the highest income support to young jobseekers transitioning from a low-wage job into unemployment. Figure 3.6 shows the net income provided by the whole tax-benefit system to young jobseekers living alone who previously worked at a minimum wage and have access to unemployment insurance. Values, expressed as percentage of the median disposable income in each country, range from 72% in Japan to less than 30% in the United States and Estonia. Young jobseekers in Greece receive 58% (equivalent to EUR 606 per month), largely explained by the contribution of the unemployment benefit (UB), with a small contribution of the housing benefit.
Compared with other OECD countries, jobseekers transitioning from medium- high-wage jobs into unemployment do not receive adequate support. With unemployment benefits paid at a flat rate that is independent of previous earnings, replacement rates become very low for higher wages. In fact, under the current rules, unemployment benefits beneficiaries in Greece receive a flat rate (EUR 510/month) that is independent of previous earnings. While this structure offers relatively good support to low-wage workers, it makes it poorly suited to alleviating revenue loss to average wage workers who lose their job.4
Values as percentage of the median equivalised disposable income in each country, 2024 or closest available year
Note: Simulations done for a 30‑year‑old adult, living alone, unemployed at the second month of unemployment and previously working at the statutory minimum wage, continuously since the age of 18. Countries where no statutory minimum wage exists are not included. Figures for Australia, Canada, Israel, Japan, Korea and New Zealand refer to 2023.
Source: OECD calculations based on output from the OECD Tax-benefit model (TaxBEN 2.7.0).
Loose unemployment insurance eligibility criteria, combined with the rapid accumulation of unemployment benefits rights, and the poor implementation of mutual obligations and activation requirements (OECD, 2024[14]), encourage both workers and employers to favour short-term employment contracts and repeated movements between precarious employment and supported inactivity.5 These incentives play particularly strongly at the lower end of the wage distribution – where young people are often concentrated (see Section 1.1). The minimum contribution period necessary to unlock eligibility to unemployment insurance in Greece is just five months. This is amongst the lowest in the OECD (Figure 3.7) and allows for transitions between fixed-term contracts of some months and periods where the jobseeker benefits from the UB, this being particularly the case of many seasonal workers. To qualify for the seasonal allowance, employees in tourism and catering professions must have completed at least seventy‑five (75) days of paid employment in the calendar year preceding the year of payment of the allowance. The number of worked days vary (from 50 to 95 days) depending on the sector the worker was employed (National Registry of Administrative Public Services, 2026[15]; DYPA, 2026[16]).
For young adults living alone and relying on GMI only, joblessness poses a serious risk of poverty and financial insecurity. Although they receive additional income through housing allowances, this support remains significantly lower than in many other European countries. For example, a young single adult without children living in Greece who is ineligible for unemployment benefits and relies primarily on the GMI receives a total monthly income of just EUR 286, which falls well below the country’s poverty line. In contrast, in countries like the Netherlands, Spain, Finland, Switzerland, Ireland and Denmark, a young jobseeker without access to unemployment benefits who lives alone and relies on GMI receives an income above or slightly below the poverty line (Figure 3.8).
Minimum contribution requirements for unemployment insurance for a 24‑year‑old, in months, 2024
Note: Contribution requirements are expressed in different ways across countries, sometimes in number of months, but other times in number of days or hours worked. Norway has no minimum contribution period but a minimum earnings requirement. The same holds for the United States, but conditions vary across states. Australia and New Zealand do not have an unemployment insurance scheme. No information is available for Colombia, Costa Rica, Mexico.
Source: Compiled using “Benefits and Wages: Country Specific Information” on www.oecd.org/en/topics/sub-issues/income-support-redistribution-and-work-incentives/how-do-countries-calculate-tax-liabilities-and-social-benefit-entitlements.html.
Housing benefits offer extra support to jobless youth. In Greece, a young adult who would like to leave his parent’s house and live alone, would receive, at best, a rent allowance of EUR 70/month, a limited support to afford, alone, housing costs if not combined with a stable job. For these youth, housing benefits play a much more important role in Latvia, Sweden, Finland, Switzerland, Norway, Czech Republic and Poland (Figure 3.8).
Values as percentage of the median equivalised disposable income in each country, 2024
Note: Simulations done for a 30‑year‑old adult, living alone, unemployed at the second month of unemployment. The jobseeker is not eligible to the UB but is receiving social assistance.
Source: OECD calculations based on output from the OECD Tax-benefit model, (TaxBEN 2.7.0).
Beyond the level of income support, it is important to highlight two aspects of GMI eligibility and provision rules that may have an impact of young adults’ decisions.
Under certain circumstances, youth enrolled in education – even if living independently – can significantly impact their parents’ eligibility for income support. Students attending secondary school (if below 19 years old), or higher education or VET (if below 24 years old) are considered dependent children in the calculation of GMI eligibility and amounts, even if they live alone. Although this rule is justified when young students are economically dependent on their parents, it can create disincentives to take up formal work, as any income they earn may reduce or eliminate their parents’ GMI support; and, for those living alone and engaged in education, to stay in education as otherwise they would no longer be considered as dependent children, potentially reducing or eliminating their parent’s GMI.
The level of GMI, once set, remains fixed for a six‑month “reference period”, regardless of earned income. This enables beneficiaries to combine GMI with earnings without affecting the benefit amount until the next reassessment. While this fixed duration of support can create stability during the transition to employment, it may also dampen job search efforts, particularly as the end of the reference period nears. When the benefit is reassessed, employment income is included in the income test, creating a “cliff effect” where even a small increase in earnings can lead to a significant reduction in benefits.
3.3.3. Incentives to work
The challenge of unemployment support, and generally of income support systems, lies in balancing adequate financial assistance with incentives to work. If benefits are too low, individuals risk poverty or accepting mismatched jobs. If they are too high, jobseekers may delay employment, reduce job search efforts, or decline suitable offers, hoping for better opportunities while maximising benefit receipt. Participation Tax Rates (PTR) quantify the share of earnings taken away, either because of higher taxes or because of benefit loss when a jobseeker takes-up a job (see Annex A).
Some OECD countries, including Greece, operate one‑off, or temporary, benefits to individuals who made a recent transition into work. These “into-work” benefits are temporary payments available during a predefined period after jobseekers take up a job and aim to support them during this transition. In Greece, unemployment benefits’ beneficiaries who take up a job can accumulate 50% of their unemployment benefits entitlements with earnings from work until the end of the originally awarded entitlement period. For those who rely on GMI, work earnings are disregarded, and therefore accumulate with it, until the next reassessment, done every six months.
Figure 3.9 shows PTRs for youth transitioning into employment with and without the effect of into-work benefits. Both scenarios are interesting: excluding temporary into-work benefits from the simulation reveals the “cliff effect”–a drop in net income when these benefits end – and highlights the tax-benefit system’s long-term impact, including reduced work incentives. Conversely, including into-work benefits in the simulation reflects “short-term” employment incentives, though these benefits are time‑limited and eventually phase out.
Low financial work incentives exist in Greece for those who transition from unemployment benefits to a low-wage job. Figure 3.9, Panel A shows PTRs of individuals transitioning from unemployment benefits to work. In Greece, when a worker is paid the minimum wage, the PTR is 90.5. PTR levels near 90 are not uncommon for low-wage jobs; for instance, PTR in the Netherlands (91.7) and Spain (93.2) are close to the PTR in Greece. In contrast, France has a significantly lower PTR for minimum-wage jobs (49.3), driven largely by the strong impact of in-work benefits.6,7
Under certain circumstances, the Greek system allows for cumulation of income support and earnings from work, leading to stronger work incentives. Indeed, PTRs in Greece are significantly lower when temporary into-work benefits are taken into account. For example, for a young adult transitioning from unemployment benefits to a minimum wage job (Figure 3.9, Panel A), the PTR falls to 52.2 (from 90.5) if we assume one has the possibility of cumulating 50% of their unemployment benefits entitlement with the earnings from the new job (i.e. when into-work benefits are switched on in the simulation). A similar effect is observed in Greece for those who cumulate GMI and earnings from work (Figure 3.9, Panel B). Greece is not the only country where into-work benefits have a strong impact on incentives to take up a job. For example, in Baltic countries and in Spain, the effect is stronger than in Greece.
Financial incentives to work, even in low-wage jobs, are stronger for families relying only on social assistance (Figure 3.9, Panel B). In Greece, the PTR gap between those who transition to a minimum wage job from unemployment benefits and from GMI is much larger than in other countries. This strong work incentive is a reflection of the low level of minimum income support. GMI provides support at a level that is among the lowest in the OECD. This is reflected by a low PTR: 45.9 for jobs at the minimum wage (due do the loss of GMI and to the payment of social contributions) and 42.2 at the average wage (due to the loss of GMI and family benefit, and the payment of social contributions and higher income tax). PTRs for those relying on minimum income schemes in Greece is among the lowest in the OECD.
Work incentives are shaped by a combination of factors: financial incentives to take up employment, as reflected in PTRs, eligibility rules governing access to income support, and the effectiveness and strictness of labour market activation requirements. These elements collectively influence the overall incentive structure for labour market participation. Eligibility conditions – particularly the rules on accumulating social contributions to qualify for unemployment insurance benefits – along with the strictness of activation requirements and the enforcement of mutual obligations for jobseekers receiving income support, significantly influence benefit take‑up. These factors can also encourage “tactical” behaviours, especially among intermittent workers.
Note: PTRs are shown for a job at the statutory minimum wage including and excluding into-work benefits. PTR decomposition corresponds to the situation where into-work benefits are excluded.
PTRs are calculated for a one‑earner, 30‑year‑old, couple with two children (2 and 3). The principal earner is entering full-time employment at the minimum wage, after two months of unemployment. Prior to unemployment, he/she had been continuously employed at the same wage level, as in the new job, since the age of 18. The following benefits are included: family benefits, in-work benefits, and unemployment benefits or social assistance benefits when unemployed. Housing benefits and childcare costs and benefits are not included. The policy reference date is 1 January 2024. Countries with no statutory minimum wage are excluded.
Source: OECD calculations based on output from the OECD tax-benefit model, (TaxBEN 2.7.0).
While work incentives in Greece are not particularly weak for jobs offering reasonable wages, opportunities for labour market entrants to access such positions remain limited. As in many countries, PTRs are high for individuals receiving unemployment benefits who take up low-wage jobs. However, compared to other countries, PTRs are relatively low for those transitioning to higher-wage jobs (e.g. at the average wage) or for those moving from GMI support to employment.
At 15.6%, the proportion of 15‑29 year‑olds who are not in employment, education, or training (NEET) in Greece is considerably above the OECD average of 12.9%, and nearly twice the European Union’s target of 9%. The NEET rate is particularly high among the age group 25‑29. A disaggregation of the NEET population reveals that the majority of young people are unemployed rather than inactive, at respectively 7.9% and 7.7%. Young women also exhibit a higher rate (16.4%) than men (14.8%). In terms of educational attainment, Greece diverges from the prevailing OECD trend, as individuals with higher levels of education are more likely to be NEET compared to those with lower educational attainment unlike in other countries.
Greece’s active labour market policies (ALMPs) have undergone significant transformation over the past years, particularly through the “Jobs Again” reform launched in April 2022. While the country’s ALMP expenditure remains relatively low at 0.25% of GDP compared to the OECD average of 0.29%, notable improvements have been made in service delivery and digital modernisation. The reform has streamlined DYPA’s governance structure, introduced digital tools for more efficient service delivery, and enhanced training provision through new upskilling and reskilling programmes. However, a critical challenge persists in DYPA’s counselling capacity, with counsellors managing approximately 1 847 jobseekers each – significantly higher than the typical 1:100‑150 ratio in well-performing OECD countries.
The evaluation of specific ALMP programmes reveals promising results, particularly for young people. Training programmes, especially those focussed on ICT skills, have shown significant positive impacts, with participants under 30 experiencing a 16‑19 p.p. increase in employment probability two years after completion. More recent training programmes, offered as part of Greece’s implementation of the National Recovery and Resilience Plan 2021-2026, focus on digital and green skills. Systematic and independent evaluations will need to verify the impact of the training programmes on young people’s labour market integration.
Wage subsidy schemes have demonstrated strong outcomes, with participants nearly twice as likely to be employed three years after entering the programme compared to non-participants. Young workers in these schemes accumulated 524 more working days over a three‑year period than non-participants. However, challenges remain, including the high prevalence of undeclared work, which complicates programme implementation and evaluation, and the tendency of wage subsidies to result in temporary rather than permanent employment opportunities.
The Greek tax-benefit system provides valuable support to young jobseekers and their families, but functions more as a collection of independent schemes addressing different needs, rather than as a coherent and co‑ordinated framework addressing the needs of young people as a whole. Greece stands out as one of the countries where the tax-benefit system offers the highest income support to young jobseekers transitioning from a low-wage job into unemployment when they are eligible to unemployment insurance. In contrast, jobseekers transitioning from medium-to-high-wage jobs do not receive adequate income support compared to their previous earnings.
The rapid accumulation of unemployment benefit rights and current enforcement of mutual obligations and activation requirements may create incentives for repeated transitions between employment and periods of income support. More consistent enforcement of job-search requirements and monitoring procedures — extending reforms already in progress — would strengthen activation.
Participation Tax Rates (PTR) – which measure disincentives to work – are high in Greece for young people eligible to unemployment benefits who take up low-wage jobs. However, under certain circumstances and for a limited period of time, the Greek system allows for cumulation of income support and earnings from work, leading, temporarily, to stronger work incentives. Additionally, PTRs are relatively low for those moving from Guaranteed Minimum Income (GMI) support to employment, as well as those transitioning to higher-wage jobs (e.g. at the average wage). Nevertheless, opportunities for young people to access the latter positions remain limited.
References
[17] Digital Skills & Jobs Platform (2025), Labour Market Diagnostic Mechanism – Greece, https://digital-skills-jobs.europa.eu/en/inspiration/good-practices/labour-market-diagnostic-mechanism-greece (accessed on 12 November 2025).
[11] Digital Skills & Jobs Platform (2024), DYPA: Over 260,000 Greeks have been certified in digital and green skills, https://digital-skills-jobs.europa.eu/en/latest/news/dypa-over-260000-greeks-have-been-certified-digital-and-green-skills.
[16] DYPA (2026), “Unemployment & Employee Insurance Benefits”, https://www.dypa.gov.gr/anergia-kai-paroxes-asfalishs-misthwtwn?tab=taktiki-epidotisi-anerghias&tab2=&tab3=.
[6] European Comission (2015), Piloting Youth Guarante: partnerships on the ground, https://ec.europa.eu/social/BlobServlet?docId=14390&langId=en.
[1] European Commission (2021), The European Pillar of Social Rights Action Plan, https://op.europa.eu/webpub/empl/european-pillar-of-social-rights/en/ (accessed on 12 November 2025).
[8] European Commission (2020), Employment, Social Affairs & Inclusion, https://ec.europa.eu/social/BlobServlet?docId=13640&langId=en.
[9] European Commission (2020), Youth Guarantee country by country: Greece, https://ec.europa.eu/social/BlobServlet?docId=13640&langId=en.
[5] European Union (2013), Council Recommendation of 22 April 2013 on establishing a Youth Guarantee, Official Journal of the European Union, https://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:C:2013:120:0001:0006:EN:PDF (accessed on 31 January 2025).
[2] Konstantinidou, D. (2022), “Greece reforms its public employment service and labour market policies”, No. ESPN Flash Report 2022/37, European Social Policy Network (ESPN), Brussels: European Commission, https://ec.europa.eu/social/BlobServlet?docId=25945&langId=en (accessed on 31 January 2025).
[10] Ministry of Labor and Social Affairs (2022), National strategy for social inclusion and poverty reduction 2021-2027, https://minscfa.gov.gr/en/national-strategy-for-social-inclusion-and-poverty-reduction/.
[7] Ministry of Labour, Social Security and Social Solidarity (2018), The Youth Guarantee Action Plan - Review of the Action Plan for the years 2018-2020, https://ec.europa.eu/social/BlobServlet?docId=24307&langId=en.
[15] National Registry of Administrative Public Services (2026), Public Employment Service (DYPA) special seasonal allowance, https://en.mitos.gov.gr/index.php/%CE%94%CE%94:Public_Employment_Service_(DYPA)_special_seasonal_allowance.
[4] OECD (2025), Labour Market Programmes, https://doi.org/10.1787/data-00312-en (accessed on 28 January 2025).
[12] OECD (2024), Creating pathways to success for young people, OECD Publishing, Paris, https://www.oecd.org/en/publications/creating-pathways-to-success-for-young-people_fa0145d1-en.html.
[3] OECD (2024), Impact Evaluation of Training and Wage Subsidies for the Unemployed in Greece, Connecting People with Jobs, OECD Publishing, Paris, https://doi.org/10.1787/4b908517-en.
[14] OECD (2024), Mapping the administrative and institutional set-up of the unemployment benefit system in Greece, unpublished.
[13] OECD - Tax-Benefit Database (2025), Description of policy rules for Greece 2025, https://www.oecd.org/content/dam/oecd/en/topics/policy-sub-issues/incomes-support-redistribution-and-work-incentives/TaxBEN-Greece-latest.pdf.
← 1. The Greek ministry responsible for labour has changed its name over time. It was known as the Ministry of Labour, Social Security, and Welfare from 2012 to 2015, and then as the Ministry of Labour, Social Security, and Social Solidarity from 2015 to 2019. Since 2019, it is called the Ministry of Labour and Social Security.
← 2. The Labour Market Diagnosis Mechanism is an online labour market monitoring tool that combines big data analysis with job demand and skills data. It was developed in 2018 to anticipate skills needs and inform public employment services counsellors, jobseekers and employers (Digital Skills & Jobs Platform, 2025[17]).
← 3. The purpose of this section is to show the adequacy of the income support system as a whole. For a detailed analysis of income support for families and housing benefits targeted at young people, see Section 4.2.5 and Section 5.2.3 respectively.
← 4. This can be measured by Net Replacement Rates (not shown in here), defined as the household income of an unemployed person expressed as a share of household income before the job loss. The higher the rate is, the more generous the benefits system, and consequently, the lower the financial incentives to return to work.
← 5. Greece increased the strictness of their activation requirements for both unemployment benefits and GMI claimants at the end of 2022 introducing sanctions for refusals of job offers (where no sanctions were previously in place) and increasing the frequency of job-search monitoring of claimants. Implementation of these changes, however, has been limited.
← 6. The Activity Premium (Prime d’activité) is a means-tested benefit that encourages low-income workers (employees or self-employed) to take up or return to work, and to boost their purchasing power. The benefit is open to applicants over 18 (or younger if they are lone parents (OECD - Tax-Benefit Database, 2025[13]). The TaxBEN methodology makes a distinction between employment-conditional benefits that require that the person is employed on a regular basis with a standard employment contract and work a certain number of hours (“in-work” benefits) from temporary benefits following a recent transition to work (“into-work”). The Activity Premium is a good example of in-work benefit.
← 7. PTR variations reflect differences in income support design. For example, in Greece, high PTRs stem from unemployment benefits loss and social contributions, while in the Netherlands, they result from lost unemployment benefits and social assistance but are partly offset by lower taxes. When workers transition to higher wage jobs the financial incentive to work is much stronger (not shown in the chart). In Greece, the PTR decreases to 60. This is also the case in the Netherlands, Poland and Spain. An exception is France, where the PTR of a job taken up at the average wage is higher than at the minimum wage, mainly because workers who earn the average wage are eligible to lower amounts of the in-work benefit.