Youth Inclusion Policies

Maria JeliazkovaConference:

Education and Work: (Un-) equal TransitionsIIOZ, 24-25 September 2015, Sofia, Bulgaria

EXCEPT: Social Exclusion of Youth in Europe: Cumulative Disadvantage, Coping Strategies, Effective Policies and Transfer

• EXCEPT is a project under EU Horizon 2020 Research and Innovation Action (call H2020-YOUNG-SOCIETY-2014) (2015-2018)

• Partner countries: Estonia (Coordinator); Bulgaria, Germany, Greece, Italy, Poland, Sweden, UK, Ukraine

• Against the background of increasing labour market insecurities among youth during the recent crisis, the aim of this interdisciplinary and internationally comparative project is to provide a comprehensive understanding of the consequences of youth labour market vulnerability for risks of social exclusion in Europe.

• A multidimensional dynamic perspective on both objective and subjective dimensions of the social exclusion of young people is adopted in order to identify the complex interrelationships and potential risks of cumulative disadvantages and possible compensatory mechanisms. Among other objectives, the project has to assess the diffusion and effectiveness of EU and national policies that address various issues of youth social exclusion are assessed in EU-28 based on expert interviews and policy evaluation analyses.

• A central objective of this comparative project is to learn about examples of best practises and provide suggestions for reforms and policies that help improving the social situation of young people who face labour market insecurities and also involve youth own voice in this process. By involving and addressing different stakeholder groups at all stages of the project the dissemination of results will be ensured.

The presentation consists of three parts:

• EU - political signals & officially declared aims

• European panorama – the context• Social Impact Assessments of Youth

Inclusion Policies – problems and questions

EU - Political signals & officially declared aims

• Long-term experience in policies, measures and initiatives, aimed at employment and social inclusion

• Employment Strategy and Social Inclusion Strategy• Many different mechanisms, organized around OMC• Europe 2020 - 'EU strategy for smart, sustainable and

inclusive growth "- objectives related to unemployment, education and poverty

• European semester – NRPs, CSRs and AGS

EU - new moments in the political signals

• Some withdrawal of Europe 2020 ("alarming" according to European networks of social NGOs).

• Political priorities for the Juncker Commission - growth, jobs and investment - but not social investment, flexible fiscal consolidation; (AGS 2015 priorities: 1. Investment Package 2. Structural reforms - internal market / liberalization 3) More flexible fiscal consolidation)

• Investment plan for Europe - 315 billion over the next three years primarily through leverage of private finance in infrastructure.

• In the social field: long-term unemployment and mobility; Youth Guarantee and Employment Initiative, with initial funding from SF.

• Structural Funds should contribute to the priorities: 20% of ESF for social inclusion and anti-poverty.

The circle (list) of policies addressing youth exclusion/inclusion

Policies directly aiming at youth inclusion: Policies for youth employment and specific youth employment

programs; Educational policies Specialized social support for social inclusion of young people

Universal labour market policies Active & Passive LMPs, taxes on labor, employers’ & employees’ social

security contributions and unemployment benefits The nature of bargaining, socio-economic structure of the labor

market and socio-demographic structure of employment The rate of technological growth, efficiency of the production process

and the degree of economic openness. Universal social protection policies influencing social inclusion

Direct and Universal Policies, linked to youth social inclusion and employment:

Direct EU – level policies/ initiatives Universal EU – level policies/ initiatives

Youth Guarantee Schemes Pro-employment guidelines; 

Youth Employment Initiative Life-long learning 

Quality traineeships and apprenticeships Flexicurity

Eures Job Active inclusion (quality job, adequate minimum income, access to social services)

Young entrepreneurs Anti-poverty strategies 

Erasmus +, etc. Pension reform, etc. 

Level of intervention – EU/ national/ local

Youth policies

• According to Eurostat’s latest figures, 23.296 million men and women in the EU-28 were unemployed in June 2015, out of which 4.724 million were young people (under 25). …, the issue of youth unemployment remains a profound challenge to the future of Europe

• Auditors unaware if “Youth Guarantee” has provided a single job yet /March 2015/. Officials from the European Court of Auditors (ECA) responsible for screening the flagship Youth Guarantee initiative have admitted that they have yet to see a single young person who has found a job through it. Identified risks: insufficient funding and lack of information; a job with "high quality" or cheap labor; inadequate monitoring.

• "The Commission has lost sight of quality jobs: We are very concerned to see that in the recently published Country Specific Recommendations (CSRs), the European Commission – by taking a new ‘less is more’ approach and targeting fewer and more specific objectives – puts the creation of sustainable jobs of good quality for future generations at risk. It’s particularly disappointing following last year’s precise recommendations on the issue of youth employment. (EYF, 02.06.2015)

• Overview of the cross-sectoral youth policy: exclusive consensus on policy formulation & failure of implementation –„rhetorical exercises… intentions with no action” (Niko, M., Life is Cross-sectoral. Why shouldn’t Youth Policy Be? Strasbourg, 2014)

Important question: why is the failure - because intentions are not serious or although intentions are serious, other powerful processes interfere?

European panorama – the context

• Numerous studies on the socio-economic realities (particularly intensified by the crisis) show that the central mainstream of socio-economic dynamics in the last few decades was concentration (“implosion”) of the GDP distribution (or "privatization of GDP").

• However these scientific results are hardly present in (reviews) policy documents on youth policies.

The financial and economic implosion generated a causal chain of several layers of effects.

• First layer (direct) effects - Imbalances in the distribution of GDP - Indebtedness – debts of households, business or public debts - Inequalities, etc.

• The second layer (main economic consequences) of the implosion are: - Relative or absolute stagnation of investments in the real economic sector (industry) - Changes in the economy sectors: de-industrialization and financialization - Changed type of growth – growth based on rents instead authentic growth - Reduction in rates of growth and changes in the scale and structure of labour demand

• Third layer - consequences - social exclusion in its various dimensions. (We can call it social “implosion” - by analogy with the financial and economic implosion). - Unemployment (due to the collapse of the branches with high capacity to absorb labour

force) - Emigration - Informal labour market - Poverty (incl. begging). - Reduced access to education and healthcare

Country specific developments

• In all countries that implemented the policies of financial and economic “implosion” – there is a deep reconstruction of the distribution of GDP and the three mentioned above layers of effects appear very cleary and with a considerable scale. In these countries, the crisis was much more severe, including youth exclusion and unemployment. And the recovery in these countries is much slower.

• In the countries which have not implemented or implemented softer policies of financial and economic “implosion”, the crisis was weaker, including the scale of youth exclusion and unemployment. The recovery of these countries is much faster and easier.

Inequalities and at risk of poverty rate 2011 (Eurostat)

05

10152025303540

Gini index at risk of poverty rate 80/20

Nouriel Roubini and Stephen Mihm write (Crisis Economics, Penguin Books, 2010)

• “In the United States, the Eurozone, the United Kingdom, and Japan, the recovery has followed a predictable, if disappointing, path. In most of these nations, lower spending and higher savings rates may reduce the debt accumulated befor the crisis , but it is unlikely to lay the foundations for a robust recovery until balance sheets are well repaired. In fact, the only advanced economies that have rerecovered a bit more quickly – Canada, Sweden, Norway, Finland, Australia and Izrael – never displayed the same enthusiasm for debt and leverage as countries like the United States.

• The recovery was far more robust and V-shaped in most of the world emerging markets, few of which had committed the sins as the worlds’ biggest mature economies. China and India rebounded quickly, as did Latin America, led by Brasil, Peru and Chile … Even traditional laggards like the countries of Sub-Saharan Africa recovered relatively fast, thanks to better governance, economic reform, and growing political stability” (302-303)

• “…most of the emerging economies burdened by too much private and public sector debt in Europe – particularly Latvia, Hungary, Romania, Bulgaria and Ukraine – faltered … during the real estate buble.”

•

Context dependencyIgnoring these features of the "context" (the picture of the socio-economic realities) poses a number of questions in front youth policies and their assessments, for example: • Are young people’s social exclusion and in particular – the youth

unemployment, effects of this huge socio-economic dynamic of a crisis type and its political drivers.

• To what degree youth exclusion and unemployment have their own (youth) specificity and to what degree they are part of a common political, economic and social trends;

• To what extend the measures for young people social inclusion can overcome (neutralize) the effects of the general policy measures that induced the general tendency of exclusion and unemployment.

• Are the measures against youth unemployment an appendage to a more general strategy for economic recovery that provides slow rates of recovery of the authentic growth or an attempt for a substitute.

Context dependency• Many analyses - impossibility of implementing effectively holistic policies for a specific group

when the context is very different, even opposite to the aims of the policies• (cited by Matt Ridley) British study, which covers 17 000 civil servants, showing that British

officials suffer from heart disease strictly according to their position in the official hierarchical pyramids. As it is known that young people usually occupy lower positions in social hierarchies (formal and informal), then what kind of a healthcare system, health or other policies could address the negative impacts? What kind of holistic policies of positive discrimination addressing young people could counterbalance the effects of hierarchies?

• Another example: If the general socio-economic policies generate high level of inequalities and they in turn give rise to numerous negative effects on quality of life and well-being, then could policies of positive discrimination compensate these effects?

• Many researchers proof that inequalities limit economic growth rates and limit employment (the prognosis of ILO as well). If this is the case, what kind of youth policies can influence such development and at whose expense? How to judge then their effectiveness - partial and formal or within the general framework of policies and their impact?

• Or for instance, the conflict, between the public interest and profit seeking in big corporations, identified as a major threat to public health (Freudenberg N., Lethal but Legal: Corporations, Consumption and Protecting Public Health; Oxford University Press, 2014). If this is really the case, then is it possible to “solve” health problems of young people when the public health at national level (of the whole population) is threatened and worsened by a certain factor (doesn’t matter which one)?

• Broadly speaking, the success of youth inclusion policies largely depends on the socio-economic and political context in which they are implemented.

• Youth policies can only be successful if the context (including general and universal policies) are not too different from (the purposes and means of) the youth policies; if the context does not generate effects that are very different (perhaps even - opposing) to those which special policies (in this case – youth policies) pursue.

• But if the context - in particular, the socio-economic dynamics, is different from the objectives of the specific policies (positive discrimination), these policies have little, if any at all, chances of success.

Social impact assessment of public policies

• Basic research problem - from what perspective do we judge policies? How we carry out social impact assessment? In terms of numbers, events and actions or in terms of social impact, aimed at development and welfare.

• Could policies targeted at specific groups be successful in the existing socio-economic context? What happened with the positive discrimination – was it successful in integrating Roma people?

• Are policies based on adequate knowledge of the generators of unemployment and exclusion? Do policies address these generators or rather they are concerned with peripheral issues - imitating effects, incl. at the expense of other groups.

• If the basic assumption of current policies is: Young people are to blame as they do not have relevant qualities and capacities. Thus policies would develop such qualities and capacities and provide employment and inclusion, then the framework of analysis could better address the questions: Where? In what way? What quality of jobs? With what prospects? With what general social effect? And what if the basic postulate is wrong and the problem lies elsewhere?

• Are moral judgments applied when formulating, implementing and assessing policies? Who differentiates between right and wrong? Are stakeholders included in this differentiation?

What we want to achieve? – cheap labour/ less expenses/ social inclusion/ something

else• (EC) “The ILO has estimated the cost of setting up Youth Guarantees in the Eurozone at EUR 21

billion per year. This should be weighed against the current costs of non-action, for benefits paid out and lost output. The European Foundation for Living and Working Conditions has estimated the economic loss caused by this waste of human potential at over EUR 150 billion”.

• Extractive institutions (gains and profits for the top at the expense of the bottom) could provide growth for a certain period, but the fruits of this growth are harvested in a way that blocks development opportunities. (Acemoglu, D., J. Robinson, 2012, Why Nations Fail: The Origins of Power, Prosperity and Poverty, London)

• Inclusive institutions are those that can provide growth and prosperity. A main characteristic of these institutions is the participation and control of members on the processes of decision-making, which is the shortest definition of democracy. (Acemoglu, D., J. Robinson, 2012, Why Nations Fail: The Origins of Power, Prosperity and Poverty, London)

• Inclusive growth – broad-based, shared, fostering a high-employment economy delivering economic, social and territorial cohesion, ensuring the benefits of growth reach all parts of EU.(EC)

• An inclusive society must have the institutions, structures, and processes that empower local communities, so they can hold their governments accountable. It also requires the participation of all groups in society, including traditionally marginalized groups ... in decision-making processes.” (WB, 2013)