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Youth Unemployment in Times of Crises in the EU 27

Study
Dr. Dieter DohmenGaliya Yelubayeva

Youth Unemployment in Times of Crises in the EU 27

Study

Publication Date:

The financial crisis led to rising unemployment levels for adult as well as for youth. The unemployment level rose across the EU 27 after 2008 and peaked only in 2013, i.e. decline started only from 2014 onwards. The middle and high qualified youth (20-29 years old) had the lowest percentage point increase in unemployment between 2007 and 2013, which rose from 7 percent to 11 percent, and managed to reach their pre-crisis levels by 2017. While the low qualified youth were disproportionately hit by the crisis, witnessing an increase in unemployment levels from 13 to 22 percent between 2007 and 2013. Moreover, they have also not managed to return to their pre-crisis unemployment level in 2019. However, it should be noted that while youth unemployment increased more in absolute terms relative increase as well as relative difference to overall employment did not change much. This indicates a level effect rather than a mere age effect.

Males were commonly more negatively hit by the crisis than females, with the gender differences being largest for the least qualified, and more so for the younger youth group aged 20-24. Differences between male and female unemployment are significantly lower for the higher educated groups and become lower with increasing age. We also find that the youth aged 25-29 had around 2 to 3 percentage point lower unemployment ratios compared to the younger age group. Strikingly, among the 20-24 year olds, the unemployment rates of the medium qualified was lower than for those with tertiary education. This suggests that the transition period of those with tertiary qualifications is a matter of concern for the younger age groups, where those with upper secondary education had more time to enter into employment.

A review of economic and employment development by sector reveals falling GDP growth rates for almost all male-dominated sectors between 2008 and 2010, while almost all female-dominated as well as most gender-balanced sectors still grew during the crisis – with few exceptions only (e.g.water supply, waste management and electricity among the male dominated sectors). In most cases, employment development followed the GDP growth path, i.e. if GDP shrinks employment also decreases and vice versa. The important gender implication of this is that – since most male-dominated branches experienced negative GDP growth, while most female-dominated as well as in most gender-balanced sectors grew even during the crisis – employment in male-dominated sectors decreased while employment in female-dominated and gender-balanced branches grew for the age group 25-65. If employment decreases, it affects mostly the younger population, which is highlighted by the employment development of youth aged 15 to 24 years of age, which shows even larger shrinking rates during the crisis in the male-dominated sectors and mainly negative rates in the female-dominated and gender-balanced sectors. Thus, youth was commonly more negatively affected, even if overall employment grew during the crisis.

Although growth rates improved for most sectors after the crisis, linked to employment growth among 25 to 64 year olds for most male as well as female-dominated sectors alike, employment development for youth was still less positive for almost all sectors, as shown in table 2. In various branches it remained even negative for youth, in spite of overall job growth, which is particularly the case for male-dominated sectors, such as, for example, agriculture, manufacturing. In construction, job loss continued for all age groups, but youth was far more strongly affected. The same discrepancy can be observed for female-dominated branches, apart from education.

These findings explain on the one hand why the unemployment of male youth increased more strongly than that of women, particularly among the low qualified: agriculture and construction, but to some extent also manufacturing are male-dominated and often linked to low qualifications.

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