Musical chairs is a fun game to play when you’re in elementary school. But for new grads looking for a job, the race to find an empty chair isn’t nearly as alluring. (See “Falling through the cracks.")
There is a crisis in youth not being able to find work — the global unemployment rate for people aged 15 to 24 was 12.6 per cent last year and is projected to rise to 12.7 per cent this year, according to Global Employment Trends for Youth 2012, a 55-page report by the International Labour Office (ILO) in Geneva.
To put those numbers in perspective, the global youth unemployment rate was 11.6 per cent in 2007 but, when the economy tanked in 2008, the rate quickly shot up and hasn’t come down.
And there’s little hope on the horizon — the report expects the rate to remain high through 2016, with no guarantees it will improve after that.
The numbers in Canada aren’t pretty, either. The unemployment rate for young workers was 13.9 per cent in April, nearly double the national rate of 7.2 per cent, according to Statistics Canada.
Dig a little deeper and the numbers are even worse. Many young people have opted to stay in school longer and pursue higher education. That’s laudable but they can only stay in school so long — when they eventually graduate and enter the workforce, they’ll just join the throngs of youth looking for work.
Many young workers lucky enough to have a job aren’t exactly thriving, either.
“Around the world, many youth are trapped in low productivity, temporary or other types of work that fall short of their aspirations and that often do not open other opportunities to move to more permanent, higher productivity and better-paid positions,” says the ILO report.
Many of these workers are taking temporary and part-time jobs, often outside their field, because it’s the only option available. They’re not unemployed on paper but they’re also not on solid ground to have thriving careers.
This is a serious societal problem. The report points out the long-term consequences of the youth jobs crisis, including: increased vulnerability to future economic shocks; depressed wages over the lifetime of these young workers; and social instability.
This is also a serious problem for employers. If an organization is lucky, its short-term succession planning pipeline is crammed full of talent. But what about a slightly longer view? Where is the next generation of leaders and high performers if many youth spend year after year unemployed or underemployed, not gaining the experience they need?
It’s also a recipe for an economic disaster. Just think of the impact on stock markets, employer pension plans and employee retirement savings.
If young workers aren’t fully employed and earning decent wages, they won’t be able to pump money into the markets.
And our population is aging. Seniors accounted for 14.8 per cent of Canada’s population in 2011, up from 13.7 per cent in 2006, according to the 2011 census. There are 9.6 million baby boomers — nearly three out of 10 Canadians — and their mass exodus from the workforce has begun.
As retirees pull money out of the markets for their golden years, what will happen to the portfolio of workers with defined contribution pension plans or the value of assets used to drive growth in defined benefit plans?
While there are no easy solutions, there are strategies worth pursuing. We know there are industries that are experiencing shortages. On the cover of the June 4 issue of Canadian HR Reporter, for example, we highlighted the fact the construction sector will need 319,000 workers by 2020.
We need to address the skills mismatch. Many other sectors are expecting similar labour crunches, both in the short and long term. Both the public and private sector (not to mention parents) need to work together to steer students into in-demand careers.
Some employers experiencing skills shortages are already working with secondary and post-secondary institutions to develop curriculum that matches the skill set needed in employees.
We need to find a way to make these in-demand trades more appealing to students. We need to get more students excited about technology careers.
But perhaps, most importantly, we need to find some way to get the 13.9 per cent of Canadian youth who can’t find work a seat in the interim in this high-stakes game of musical chairs. Otherwise, we risk having a lost generation.
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