Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain Noviembre de 2009 Youth: Employment & inclusion in times of crisis Situation in Spain.

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Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain Noviembre de 2009 Youth: Employment & inclusion in times of crisis Situation in Spain Horsens, Denmark, 26 April Julio Martínez Meroño Advisor National Service for Employment - Spain

Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain 2 Situation: <30Y <25Y Much higher than total unemployment!

Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain 3 Evolution:

Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain 4 Evolution:

Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain 5 Similarities:

Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain 6 Summarizing: It is very high (x2) It has been so for a very long time (>40 Y) Very sensible to the economic cycle Youth/total unemployment  UE (similar causes or just similar effects?)

Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain 7 Causes: Education system: Lower levels (38,8% SP - 23,4% UE-15) Early leavers (30% SP - 20% UE-15) Polarization Labour market: Unflexibilities Duality Efficiency of active employment policies

Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain 8 Early leavers: Very high (30%-20% UE-15) Base unlinked to economic cycle Boosted by real estate bubble Big unskilled workforce (not so young now!) Employability divergence started in 2003 Long lasting effects!

Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain 9 Polarization: Great effort in improving education level (but bias on University…!) Unemployment both at high & low levels!! Discouragement at lower levels Overeducation at higher levels Middle level education displacement Disadjustment offer/demand

Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain 10 Labour market: Unflexibilities: Colective bargaining, low flexicurity Duality temporal/permanent contracts: “Tunnel effect” (trap)  Human capital Adjustment -> Temporary contracts Active Employment Policies: Low resources Subsidies to employment, not so much for training, orientation, insertion

Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain 10 What are we doing about it? New legislation on labour market (Feb2012) Whole set of measures in AEPs, training and education BUT: Extreme constraints due to budgetary restrictions!

Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain 11 Measures (1): Market unflexibilities: Substantial changes in collective bargaining system Suport to part time contracts  Internal flexibility in companies Market duality:  dismissal costs for permanent contracts Encouragement of permanent contracts (“support to entrepeneurs”) Incentives for transition temp->perm contracts

Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain 12 Measures (2): AEPs: Placement agencies Better coordination with regional admins Better evaluation of AEPs->allocation resources Substantial reduction in grants Training Key for inclusion of early leavers New training contract -> accreditation “Training account” Open to competition

Servicio Público de Empleo Estatal SEPE Youth unemployment in Spain Thanks… 13 Julio Martínez Meroño Advisor National Service for Employment - Spain