Youth worst affected by labour market gaps

An OECD report points out that more than half of all job creation in its 34 member countries since the mid-1990s has been in “non-standard work”, which accounts for about a third of total employment.

By non-standard workers it means those who are either self-employed or in part time or temporary work. It states that these workers are worse off in many ways, not only in terms of earnings: they tend to receive less training and, in addition, those on temporary contracts have less job security than workers in standard jobs.

A study from the International Labour Organisation, “the changing nature of jobs", also highlights the growing inequality caused by insecure jobs, stating that only a quarter of workers globally have a permanent contract.

Whilst these reports have grabbed the headlines because of the worrying rise in inequality that such wage disparity and insecurity produces, it’s worth looking behind the headlines to see who in particular is hit by this. It is young workers that are the worst, and disproportionately, affected by such unstable work: 49% of young people are on these kind of temporary contracts as opposed to 11% of the wider adult population.

Whilst it’s true that non-permanent work can be positive for young people that want to combine part-time work with studies, it is clear that this drastic increase during the years since the onset of the economic and financial crisis is not voluntary. The fact is that young people are forced into this kind of work, because there is nothing else on offer.

The OECD recognises this, stating that “non standard work can be a ‘stepping stone’ to more stable employment ... In many countries, younger workers, especially those with only temporary work contracts have a lower chance of moving on to a more stable, career job.”

It is simply not fair that young people have to bear the flexibility needs of the labour market. And, unfortunately, we’re already witnessing the negative impact of this. Young people have replaced older people as the group experiencing the greatest risk of poverty. Between 2007 and 2011 young people aged 18 to 25 suffered the most severe income losses, whilst for those aged 65 and over their income, on average, increased.

Unfortunately this is not either a short-term “blip” in young people’s lives. It has a long-term impact both on young people’s ability to live independent, autonomous lives and on society itself. For example, there is a positive association between a young person’s income and the probability of leaving home in all European countries.

This is also true for the age of becoming parent, which is being postponed in Mediterranean countries, which have been hardest hit by the crisis. In Italy, Greece and Spain 50% of young people have children at the age of 36 or older for men and 32 for women (when the EU average was 34 for young men and 30 for young women in 2011).

The OECD recommends that reducing the growing divide between rich and poor and promoting opportunities for all is needed and that this can be done through a “focus on policies for the quantity and quality of jobs; jobs that offer career and investment possibilities; jobs that are stepping stones rather than dead ends”. In order to avoid a “Peter Pan generation” of young people who are unable to grow up and make their own way in life European leaders need to design policies that tackle inequalities and that’s how we will ensure growth, as well as a fair and equal society.

Why should young people bear the brunt of austerity politics? Which we are seeing time and time again, for example, in the age-based cuts to minimum wages that we have seen in several countries. This, as well as the phenomenon of unpaid, recurring internships and temporary contracts, needs to be reversed urgently as they merely propagate inequalities, increase income inequality and further cement the most vulnerable into poverty and social exclusion.

Whilst some measures to tackle youth unemployment are already in place, such as the youth guarantee, and are a welcome step, they alone will need not tackle this. Macroeconomic policies promoting growth, alongside redistributive measures, will be the only way to bring young people out of the doldrums they are in.

Allan Päll is the secretary-general of the European Youth Forum