What is the Youth Guarantee?
The European Union’s Youth Guarantee Scheme is a new approach to tackling youth unemployment which aims to ensure that all young people aged 16- 25 get a good-quality, offer of employment or further training within 4 months of them leaving formal education or becoming unemployed. A lasting foothold in the labour market and favourable career progression for the young people are the intended outcomes. At the same time European economies will benefit from boosted overall youth employment and activity. The Guarantee was inspired by a scheme developed in Finland, which successfully allocated a job, traineeship, apprenticeship or further education to 83.5% of registered young people within three months.
EU countries endorsed the principle of the Youth Guarantee in April 2013 (Council Recommendation). Memo – EU Youth Guarantee: Questions and Answers (February 2015) and Member States presented their Youth Guarantee Implementation Plans to the European Council. The plans outline the specific measures to be taken to implement the Youth Guarantee within each country as well as the roles of public authorities and organisations and plans for securing financing. The implementation of these national plans is now underway. EU countries are taking significant steps in implementing the Youth Guarantee, which has in many cases led to structural reforms. The Joint Employment Report 2015 recognised promising early steps with concrete examples of success in many countries. Thanks to support from the Youth Guarantee scheme, many young people in Europe have managed to find work or enrol on a course which will boost their career.
Success stories so far include examples of funding further education for young people, such as an Accounting course for Evita from Latvia for which she could not have afforded the tuition fees without support. The Youth Guarantee provided Evita with funding for the course, as well as general advice and help with filling in the application forms. She says; “Things are going great, and I’ve even received job offers! My long-term goal is to start my own accountancy business – the study programme is giving me the tools I will need in the future.” The Youth Guarantee scheme in Portugal enabled Sanitary Engineering graduate Sandrina to link her studies to the world of work. Soon after registering with the Youth Guarantee, a company specialising in her study area contacted her with a traineeship offer. “The Youth Guarantee scheme opened the door to the labour market for me,” she explains, “which is what I appreciate most of all. Targeted hiring incentives and start-up subsidies have been also means to promote the activation of young jobseekers in some Member States: In the Netherlands, for example, a tax rebate has been introduced for employers hiring young people who have been claiming unemployment benefits or social assistance for two years or more.
The EU financially supports the set-up and implementation of Youth Guarantee Schemes through the European Social Fund and the Youth Employment Initiative. It also provides opportunities for sharing examples of good practice, and monitors implementation as part of the annual cycle of EU economic policy guidance and surveillance. Although the scheme is still in its early stages and results across Europe are not yet consistent, progress is being made which will contribute to providing youngsters a better career future.
How are Youth Guarantee schemes being set up?
Developing and delivering a Youth Guarantee scheme requires strong cooperation between all the key stakeholders: public authorities, employment services, career guidance providers, education & training institutions, youth support services, business, employers, trade unions, etc.
Early intervention and activation are key and, in many cases, reforms are needed, such as improving vocational education and training systems.
The European Commission has helped each EU country to develop its own national Youth Guarantee Implementation Plan and start implementation. The Commission also supports awareness raising activities on the setting up of the Youth Guarantee, with a pilot running in 4 Member States (Latvia, Finland, Portugal and Romania). The concept, products and visuals from this pilot have been put at the disposal of national, regional and local authorities who wish to use it further as an electronic toolkit.
Further, the Commission also facilitates the sharing of best practices between governments, in particular through the European Employment Strategy Mutual Learning Programme.
Cost-benefits of a Youth Guarantee
Although precise figures are impossible to determine until each EU country has defined exactly how it will implement the scheme, recent research rates the benefits much higher than the costs.
The total estimated cost of establishing Youth Guarantee schemes in the Eurozone is€21bn a year, or 0.22% of GDP. (Source: ILO report – eurozone job crisis)
However, inaction would be much more costly. Young people not in employment, education or training are estimated to cost the EU €153bn (1.21% of GDP) a year – in benefits and foregone earnings and taxes. (Source: Eurofound report on youth unemployment)
Not all Youth Guarantee measures are expensive. For example, greater cooperation between stakeholders is effective without requiring large budgets.
To make the Youth Guarantee a reality, national budgets should prioritise youth employment to avoid higher costs in the future.
Source and more information: http://ec.europa.eu/social/main.jsp?catId=1079