EU ministers plan funding cuts for youth employment scheme, despite its success

Marianne Thyssen [European Commission]

European Commissioner Marianne Thyssen defended the Youth Employment Initiative (YEI) at a meeting of European social affairs ministers on Thursday (13 October), hoping to encourage member states to unblock a €2 billion budget. EURACTIV France reports.

European leaders launched the YEI with great fanfare in 2013. Three years on, and the initiative launched to stem the alarming rise in youth unemployment in the EU has shown broadly positive results.

The programme “has made the difference for many youths, even if we are still a long way from the finishing line,” Thyssen said at a presentation to the Employment, Social Policy, Health and Consumer Affairs Council in Luxembourg on Thursday.

Auditors unaware if “Youth Guarantee” has provided a single job yet

Officials from the European Court of Auditors (ECA) responsible for screening the flagship Youth Guarantee initiative have admitted that they have yet to see a single young person who has found a job through it.

According to the data analysed by the Commissioner, 14 million young people were registered in the system over the last three years. 65% of them, some nine million people, accepted the offer of a job, internship or further training as a result of the scheme.

Of these nine million, 70% found jobs. But while the reduction in unemployment among youths was “faster than among adults”, the Commissioner said, the figures are still alarming. “According to the latest figures, we are now at 18.6%, which is far too high,” she said.

A programme that has proved itself

The YEI aims to find employment or training for people under 25 years of age within four months of the end of their studies or the loss of a previous job. The mechanism enjoyed a budget of €6bn between 2013 and 2015, half of which came from the European social fund. A share of this budget was used to concentrate efforts on areas of Europe where the youth unemployment rate exceeded 25%.

And the programme has proved itself in action. In France, the Court of Auditors recently criticised the multitude of national “back to work” schemes. But it singled out the French version of the YEI, subsidised in part by the EU, as one of the few effective ones.

The scheme has a re-employment rate of 49.9%, according to the French auditors.

Thyssen: New business-led initiative will help young people into jobs

Though the implementation of the Youth Guarantee in member states is on track, the Commission is launching a new initiative with businesses to help more young people into jobs, says Marianne Thyssen in an exclusive interview.

Yet in France, as in the majority of European countries, youth unemployment levels are still far higher than levels in the adult workforce. In mainland France, youth unemployment remains stubbornly high at 23.7%, compared to 9.6% for the working-age population as a whole.

Arguing for funding

“We have to continue our financial efforts and the Commission proposes to increase the resources available to this initiative as part of the mid-term revision of the Multiannual Financial Framework,” Thyssen told the EU ministers.

In spite of the initiative’s positive reception, unblocking funds for the programme may prove difficult.

The Commission has pencilled in a budget of €2 billion for the period 2017-2020, of which €1 billion is set to come from the European Social Fund budget.  But this figure, which is already seen as a step down in ambition compared to the previous three-year period, has been further shaved down by the member states.

EU's ‘Youth Guarantee’ scheme slacking

So-called “Youth Guarantee” schemes have reduced unemployment of young people in Finland, but expanding the scheme to other European countries has been slow and lacking commitment. EURACTIV France reports.

In this clash over the budget, the European Parliament has emerged as the champion of youth employment. On Tuesday (11 October), the Parliament’s budgets committee reversed the cuts made by the member states, adding a further €1.5 billion to the YEI.

“Europe has to be big on the big issues. As a result, we have strengthened the budget lines to support employment and economic growth and cancel out the cuts made by the member states, which acted against their own priorities,” said Jens Geier, a German Socialist MEP and the rapporteur on the subject.

€21bn required

But the sums being passed back and forth to guarantee the future of the programme pale into insignificance compared to the needs identified.  The International Labour Organisation (ILO) said that a budget of €21 billion per year would allow this programme to be really effective at a European level.

While a budget increase of this scale is not on the cards, the EU’s socialist labour and social affairs ministers from Luxembourg, the Czech Republic, Portugal, Slovakia, Austria, France and Sweden signed a declaration on Wednesday (12 October), in which they deplored the under-investment in the programme.

  • 26 October: plenary vote on 2016 EU budget proposal.

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