There is no Sustainable Future of Work if Young People Are Left Behind

The debate on the future of work is gaining momentum on both sides of the Atlantic as several initiatives are animating the conversation. The discussion not only focuses on the impact new technologies have on on the future of work but also considers consequences for the future of social protection for all workers.

The debate is necessarily very technologically oriented, with a focus on the potential increase in labor productivity that new technologies can achieve, while also trying to gauge the impact on inequities, among and within countries, and on the need to teach new skills and improve existing skills.

The future of work is likely to bring significant economic and social challenges that will impact mostly young people. They should be offered “decent work”, as the 2019 Council Conclusions on Young People and the Future of Work stresses. In line with the 2030 Agenda for Sustainable Development, in particular Sustainable Development Goal 8, as well as with Youth Goal 7, “decent work is to be treated as a legitimate aspiration of young people, starting with their very first remunerated professional experience.”

But a key issue is too frequently overlooked in these discussions. That is the need to identify clear target groups for the various interventions and avoid a one-size-fits all-solution. Young people aged 15 to 24, whether employed, unemployed or so-called NEET (Not in Education, Employment and Training) youth, should be considered the priority group in these discussions, as they are likely to be in the workforce the longest. And they should be given a voice in the discussions and the establishment of the policies that will affect them.

The UN estimates that by 2030, a staggering 60% of youths, equating to 830 million people, will lack the basic skills required by the labor market. To address the widening skills gap, policymakers should more do more now to support the growth of next-generation workers and offer equal opportunities to access the labor market.

The EU Youth Strategy 2019-2027 stresses that “Europe cannot afford wasted talent, social exclusion or disengagement among its youth. Young people should not only be architects of their own lives, but also contribute to positive change in society.”

Several factors have contributed to the widening skills gap and risk of wasting talent. Young people have been particularly affected by the COVID-19 pandemic, as was confirmed by the International Labour Conference’s Global Call to Action for a human-centred recovery from the COVID-19 Crisis that is inclusive, sustainable and resilient. “The crisis has profoundly disrupted the education, training and employment of young people, making it even harder for them to find a job, successfully transition from education and training to work, continue education or start a business.” Their rate of employment loss has been much higher than that of adults, and young people’s education has been interrupted.

Young people seem, however, not to be always an active part of the discussion shaping the future of work. While there are examples of young people involvements, such as the EU Youth Dialogue and the U.S.’s Pathways for Youth and the Future Forum, there is no consistent and coherent approach to allow young people’s voices to be heard.

Young people are a complex and mixed category encompassing several subgroups, one of which is NEET youth. The NEET concept has been widely used since 2010 as an indicator to inform youth-oriented policies on employability, education, training and social inclusion in the EU member states. Conversely, young people in this category are sometimes described in the U.S. as “disconnected” youth.

The COVID-19 crisis reversed 15 years of progress in reducing youth NEET rates. On average in 2020, worldwide almost one in four (23.3 %) of all young people had NEET status. The debate on the future of work needs to take this into account. No matter the definition used, NEETs/disconnected young people are definitively the ones most in need. The future of work debate and planning should dedicate particular attention to this subgroup.

THE NUMBERS SHOW THE NEED

Young people are a significant and vital part of the population in the EU and the U.S. In the U.S., in July 2023, there were 21.6 million young people (aged 16 to 24) in the workforce, of whom 2.059 million were unemployed. In the same period, in the EU, the number of unemployed young people in the same age group stood at 2.683 million. The number of unemployed youths appears to have been somewhat reduced in recent years.

Policymakers should focus on NEETs as well as unemployed young people. They are an untapped source of potential talent. This requires a focus on a broader set of indicators. While the most commonly used indicator to assess the youth situation in the labor market is the youth unemployment rate, it does not provide as complete a picture as the NEET rate (see Figure 1), which includes inactive young people.

In 2022, 14.5% of U.S. young people aged 15 to 29 were NEET, while in the EU 11.7% were. Reducing this rate is one of the targets of the European Pillar of Social Rights, an EU policy initiative to bring back the social dimension of the EU, rebalance economic policies with social considerations, while at the same time addressing key issues related to changes in the world of work and society more generally, promoting higher social standards. The EU goal is to lower the rate of NEET young people aged 15-29 to 9% by 2030.

Unlike in the EU, U.S. youth unemployment rates and college attendance statistics get considerable media attention, but the NEET rate gets little to no attention. This is a reflection of the fragmented nature of youth policy in the U.S. and the need for a federal office that serves a coordinating function. Instead of the kind of detailed information on NEET rates that Eurostat, the statistical office of the EU, provides, U.S. federal government data on NEET rates is limited and the ages measured are not consistent across agencies. The Federal Interagency Forum on Family and Child Statistics publishes a NEET rate for 16- to 19-year-olds. The NEET rates published by the Department of Education are limited to 18- to 24-year-olds. Notably, the Bureau of Labor Statistics at the Department of Labor does not publish NEET rates. The International Labour Organization (ILO), however, regularly publishes NEET data.

Figure 2 indicated that the number of NEETs in the U.S. (4.26 million) does not differ dramatically from that in the EU (4.71 million).

Both in Europe and in the U.S., this relevant component of the young population does not appear to be a key target group for decision-makers on the future of work, or at least not explicitly. The cost to the entire society of excluding NEET youth from the labor market and society as a whole, is enormous. And failing to prepare the future of work for them is to prepare for further failure.

BRINGING YOUNG PEOPLE TO THE TABLE

Coherent, consistent and comprehensive strategies to address the future of work for young people, particularly NEETs, are of utmost importance. Including the challenges young people face, and particularly the NEETs, into the future-of-work decision-making is crucial. It is also crucial to hear their views and expectations about the proposed changes and find a way to enlist them in the discussion about the future of work.

There can be no sustainable future of work if a big proportion of the population, likely to be in the labor market the longest, is left out.

Without assistance, economically inactive young people might not gain critical job skills and never fully integrate into the wider economy or achieve their full earning potential. Many NEETs might also represent a potential source of social unrest if they feel, for a long time, neglected and rejected by society. Being excluded both from the labor market and the education system heightens the individual’s risk of social exclusion and their likelihood of engaging in asocial behavior; this affects both the individual’s well-being and their relationship with society.

There are several ways to incorporate young people in general and NEETs in particular, in discussions, planning and policy decision-making.

• The integration process of young people should start with an assessment of what skills they really need, how they can attain them, and what it will cost them, business and government. Reliable and accurate data on the NEET population must be developed.
• Policies affecting young people should be anchored in the real needs and situations of young people, particularly NEETs. That requires continuous research and outreach to young people and youth organizations. The collection of disaggregated data (by gender, by economic status, by region, by education level, for instance) is of particular importance to foster understanding of the needs of different groups of young people, particularly those with fewer opportunities.
• Youth employment programs and initiatives to address the future of work should be an integral part of long-term national strategies, instead of the results of short-term, ad hoc interventions. For this to occur, political leaders should include a chapter on measures/policies to address the future of work for young people, and particularly NEETs, in their upcoming political program for 2024 election.
• Strategies and policies affecting the future of work should have a specific section on the impact on young people, particularly in case of structural reforms or measures supporting those reforms. Those strategies and policies should include perspectives from young people, with a focus on NEETs as a key group to address.
• Strategies and policies impacting the future of work should be accompanied by specific funding for measures financing the adaptation of young people to the future of work. Education, (re) integration into the labor market, reskilling and upskilling of young people should be key elements of those allocations.
• Young people have different needs, interests and wishes from other age-groups. As part of their policy campaign, leaders should identify the sectors where youth participation is likely to be crucial, such as digital, green and health care as indicated by the ILO, and base their policy decisions on this.

Today more than ever it is urgent to define priorities to promptly address the risks and opportunities that the transformations of the future of work entail. Young people must be the priority immediately. Not focusing on them is too high a risk to take, and the cost of remedying this mistake would be exponentially higher. Young people need and deserve help, and the sooner it comes the better.

*This text expresses the personal opinion of the author and not that of European the Court of Auditors. *

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