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Young people are worse off than older generations in today's labour market

LMO 10.10.2017

Active ageing, investing in education and developing the right skills among main solutions for future-proof Europe

Despite a record high number of people in employment and continued economic growth in the EU, young Europeans today face less stable career prospects, less social security and worse living standards than older generations. This makes intergenerational fairness one of the top political priorities, a conference held at the European Economic and Social Committee (EESC) revealed.

The high-level conference entitled "Review of Employment and Social Developments in Europe: Intergenerational Fairness and Solidarity", held in Brussels on 10 October, was co-organised by the EESC's Labour Market Observatory (LMO) and the European Commission's DG for Employment, Social Affairs and Inclusion.

Its goal was to hear the views of EESC members, social partners and other civil society organisations as well as government representatives about the findings of the 2017 Employment and Social Developments in Europe (ESDE) review, published by the Commission in July 2017.

The ESDE review, which annually presents key employment and social issues for the EU and its Member States, confirmed positive labour market and social trends, highlighting the unprecedented number of 234.2 million people in employment in the EU and the 7.8% unemployment rate at EU level - the lowest level since 2008.

But the review also showed that young people were at a disadvantage compared to prime-age and older workers. Despite having better education than their parents or grandparents, young Europeans face difficulties in entering the labour market and are more at risk of precarious work, such as part-time or temporary contracts.

This in turn makes them more vulnerable on the labour market, as they have lower job tenure and are less protected by welfare systems or collective agreements. As a result, they tend to postpone important life decisions such as starting a family.

"This review shows a generational divide in the labour market. Member States, the European institutions, social partners and civil society organisations share a responsibility to work for a future-proof Europe," said Pavel Trantina, the president of the EESC's Section on Employment, Social Affairs and Citizenship.

The Commissioner for Employment, Social Affairs, Skills and Labour Mobility, Marianne Thyssen, stated that "intergenerational fairness and solidarity is one of the big challenges that policy-makers face today". "We have to ensure fairness between generations and the sustainability of our social model," she added.

Due to unfavourable demographic trends and Europe's ageing population, today's young and particularly the future generations will pay much higher contributions only to receive a much lower old-age pension, relative to wages, once they retire.

Michel Servoz, Director-General for Employment, Social Affairs and Inclusion at the European Commission, considered that the problem of demographic change and intergenerational divide was as disturbing as climate change. "Everywhere you look, young people are in a more difficult situation," he said.

But the conference participants agreed that it was not all "doom and gloom" and looked at possible solutions, such as investing in people's skills and employability, retraining workers and helping people who are inactive and currently account for 30% of the EU's working age population.

EESC Member Christa Schweng put the emphasis on the need for practical training as an integral part of education systems. There is a need to link the education system and the world of work more closely, so as to improve the employability of the young, she said.

Another solution is the promotion of active ageing. Active ageing is essential so that older people can contribute to our society instead of being a burden, said Carlos Trindade, president of the LMO. He added that this should be promoted through education and healthcare for the elderly, their access to IT, promotion of active citizenship and intellectual creativity, and similar measures.

Negotiated solutions between social partners, civil society and governments and the adaptation of social dialogue to the new realities of work are also high on the agenda.

Solidarity between generations is one of the key components of the European social model, concluded Mr Trindade.