There’s a lot of talk lately about Europe’s so-called Lost Generation, the more than one in five under 25s who are unemployed. The further south you go, the worse it gets: 50% youth unemployment in Greece and Spain and more than 30% in Bulgaria, Italy, Portugal and Slovakia.
Governments have started schemes to get their youth working. Spain offers loans to help young people start businesses, while a plan proposed in France would allow companies to hire employees between the ages of 16 and 25 and pay just 25% of their salaries. Government will pay the rest. While well-intentioned, initiatives like these miss a fundamental point.
The problem is often about an imbalance of supply and demand. A decade of prosperity in Europe, before the crisis, has led to the best educated generation in its history. Young people with doctoral degrees don’t want vocational jobs. Academics call it a “vertical mismatch,” and in Europe, it’s estimated that 30% of workers are overeducated for their jobs.
More and more young people are unwilling to make that trade-off by taking jobs they think are beneath them. So they stay home, don’t buy cars or homes, put off marriage, and wait for the right employer to come along—at great cost to productivity and the economy.
There’s also a big percentage of the population that is undereducated for the work available. Laszlo Andor, European commissioner for employment, social affairs and inclusion, says that in Spain amid the property and tourism boom, many young people gravitated to these jobs that didn’t require advanced degrees or training. When property and tourism markets collapsed in 2009, more than a million young people (unprotected by contracts) were out on the streets but lacked the skills and education to find new jobs.
It’s little wonder that one of the earliest of the Occupy-like protests took place in Spain. In May 2011 (four months before the Wall Street protests), Spanish youth camped out in the center of Madrid, calling themselves the indignados, or the indignant ones. While US movements have largely died down, in countries like Spain, they’re just getting started. Last week thousands of people, many of them under 25, gathered outside parliament in Madrid to rail against austerity, high taxes, and increasing unemployment. Protestors threw rocks and bottles and police hit back, with dozens of people landing in the hospital. A time bomb, indeed.