Many young people are entering the workforce in an “employment ice age” of dwindling opportunities amid the pandemic, according to a new report.
The warning over a jobs crisis facing the “pandemial” generation comes from the World Economic Forum (WEF), best known for organising the Davos summit of world business and political leaders which takes place virtually next week.
It highlights how young people across the world are facing the second major global crisis in a decade.
Long shadow of the last global crisis
“They entered youth in the throes of the financial crisis, and are now exiting at the outset of a pandemic not seen in generations. They will face serious challenges to their education, economic prospects and mental health,” said the report.
Youth unemployment surged after the global financial crisis in 2008. Joblessness among the young has remained “stubbornly high” ever since, particularly in the Middle East and North Africa, according to WEF’s Global Risks Report 2021.
WEF researchers argue governments did too little to help younger generations “regain their footing” after the last crisis, and that austerity hampered investment in education. Fiscal policies led to “unequal prosperity gains” across generations.
It blamed such failures and the rise of the gig economy for the large numbers of young people working in “precarious service jobs that are vulnerable to major shocks.”
How COVID-19 income hit youth incomes
The research suggests COVID-19 has since had a disproportionate economic toll on the incomes of the young as they disproportionately work in hard-hit sectors like service and manufacturing, often with “limited job protection.”
80% of young adults worldwide do not even work in the formal economy, the report said, with many in short-term, low-paid jobs. It means a lack of protection during hard times, which “increases youth’s risk of sliding into poverty quickly.”
Meanwhile education shutdowns could affect young students’ ability to learn skills needed for further education, training and entry-level work, it added.
The number of young people globally who are not in employment, education or training (NEET), which already stood at 21% in early 2020, is expected to keep rising.
‘Youth needs a say in global recovery’
The research suggests just a month of unemployment between 18 and 20 years’ old can cause a permanent income loss of 2% in the future. Limited economic and educational prospects will “exacerbate youth frustrations,” fuel mental health issues and limit social mobility.
Youth disillusionment is now a “critical threat” for the world, the report adds, but it suggests it is being widely overlooked. “Youth must be guaranteed a say in the global recovery. Failure to ensure youth a seat at the table risks entire societal and economic systems being rejected by this generation.”
Proposals include giving young people greater “channels” to make their voices heard at all levels of government, on company boards, and in multilateral organisations.
Watch: Why are job losses rising despite the economy reopening?