The Lost Generation

The following New York Times article, http://www.nytimes.com/2013/11/16/world/europe/youth-unemployement-in-europe.html?smid=pl-share, reports that between 28% (Ireland) to 56% (Spain) of youths remain unemployed.  We know that long term youth unemployment can lead to a chronic underclass that threatens to undermine societal stability, constrain economic productivity, erode household savings, and extend the working life of the aged. The impact on public health can be severe as spending on health care declines; as do all government programs designed to preserve societal security.  The traditional fix of pump priming, which the Europeans have tried in this recession, has not worked. When consumers are pessimistic, no amount of encouragement will get them back into the shops. Witness Japan in the 1990s.  The most worrying outcome from this sad state of affairs is the rich fishing ground for organized crime, terrorists, and anarchists.

Table 1: Change in youth unemployment from the year ended June 2008 to the year ended June 2013.

INCREASE OF 15+ PERCENTAGE POINTS

INCREASE OF 5 TO 15

INCREASE OF 0 to 5

DECREASE

Greece

58

Spain

Unemployment rate,

ages 15−24

55

50%

Unemployment rate,

ages 25−29

Greece

41

40

Portugal

40

Italy

38

Spain

34

30

Ireland

29

France

25

Portugal

22

Belgium

22

Britain

21

20

Italy

20

U.S.*

16

Ireland

16

France

13

10 The Netherlands

Belgium

11

10

Austria

9

Britain

8

Germany

8

Germany

7

9

U.S.

Austria

6

7 The Netherlands

’08

’13

’08

’13

*Ages 16-24 only.

Figures are rounded to the nearest whole number and reflect data for the most recent quarter available. Monthly data is available for some countries showing further increases for ages 15-24.

Source: Eurostat; U.S. Bureau of Labor Statistics