Germany, France and Italy urge youth jobs plan

'Entire generation of young people who are scared'
By Ingrid Melander and Nicholas Vinocur
||Last Updated: 05/28/2013

PARIS (Reuters) — Europe must urgently tackle youth unemployment, the French, German and Italian governments said on Tuesday, urging action to rescue an entire generation who fear they will not find jobs.

Ministers called for a mixture of measures including helping small companies and boosting apprenticeships.

Some 7.5 million Europeans aged 15 to 24 are neither in employment nor in education or training, according to European Union (EU) data. Youth unemployment in the EU stood at 23.6 per cent in January, more than twice as high as the adult rate.

"We have to rescue an entire generation of young people who are scared. We have the best-educated generation and we are putting them on hold. This is not acceptable," Italian Labour minister Enrico Giovannini told a conference in Paris.

Germany in particular, weary of a backlash as many in crisis-hit European countries blame it for austerity, has over the past weeks taken steps to tackle unemployment, striking bilateral deals with Spain and Portugal.

Its labour and finance ministers told the conference that to help young people find jobs, Europe must continue on the path of structural reforms to boost its competitiveness as well as make good use of available EU funds, including €6 billion (C$8 billion) that leaders have set aside for youth employment for 2014-20.

"We need to be more successful in our fight against youth unemployment, otherwise we will lose the battle for Europe's unity," German Finance Minister Wolfgang Schaeuble said.

While Germany insists on the importance of budget consolidation, Schaeuble spoke of the need to preserve Europe's welfare model.

If United States welfare standards were introduced in Europe, "we would have revolution, not tomorrow, but on the very same day," Schaeuble told students at the Sciences Po political science institute hosting the conference.

While all agreed on the urgency needed to tackle youth unemployment, ministers offered no concrete plans, insisting Europe must be pragmatic and work on various strands.

Schaeuble said this was why Germany had also decided to strike deals with countries such as Spain and Greece.

"Let's be honest, there is no quick fix, there is no grand plan," said Werner Hoyer, head the European Investment Bank.

Together with ministers, he said policies aimed at boosting youth employment must focus on small and medium-sized enterprises as they are the main entry point to the labour market for most.

More than one-half of Spain's under 25-year-olds are jobless, as are nearly 40 per cent in Portugal. In Greece, youth unemployment shot to a record 64 per cent in February.

In March 2013, the lowest youth unemployment rates were in Germany and Austria, both below eight per cent, highlighting the wide disparities within the EU.

The youth employment crisis will be a central theme of a June EU leaders' summit, and German Chancellor Angela Merkel has invited EU labour ministers to a youth unemployment conference in Berlin on July 3.

Following up on an idea aired earlier this month, French President Francois Hollande urged the euro zone to work towards a joint economic government with its own budget which could take on specific projects including tackling youth unemployment.

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