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A woman walks past a job-recruitment agency in Liverpool last week. The youth unemployment rate in Britain is now 21.9 per cent. (PAUL ELLIS/PAUL ELLIS/AFP/GETTY IMAGES)
A woman walks past a job-recruitment agency in Liverpool last week. The youth unemployment rate in Britain is now 21.9 per cent. (PAUL ELLIS/PAUL ELLIS/AFP/GETTY IMAGES)

Global Exchange

U.K.'s youth getting pushed down the jobs ladder Add to ...

The latest bit of bad news for young people comes to us from Britain, where the number of jobless youth has pushed past one million.



It’s clear that young people are paying a disproportionately high price in this recession when it comes to employment. There is no shortage of grim data on the subject, particularly in Europe, where nearly half of all youth in Spain and Greece are out of work.



Shocking as it is though, unemployment data doesn’t capture the full range of difficulties young people are up against.



Take Britain, where the youth unemployment rate is now at 21.9 per cent, double that of the overall population. Even those young people who do find work are more likely than any other age group to be underemployed, working fewer hours than they’d like. What’s more, they are more apt to “trade down” or accept jobs below their skill level, according to economists David Bell of Stirling University and David Blanchflower of Dartmouth College.



Indeed, though all workers were more likely to accept lower skilled work during the recession, the effect was strongest among those aged 16 to 24, write Mr. Bell and Mr. Blanchflower, who analyzed data from the United Kingdom Labour Force Survey.



The trading down phenomenon has a number of consequences, the most immediate being a knock-on effect in the labour market. When young people trade down to lower-skilled jobs, they deepen the troubles of less qualified workers by forcing them to compete against candidates with better qualifications. These workers are themselves pushed to a lower level on the occupational hierarchy and so on it goes as the number of unemployed youth at the bottom swells.



Obviously some are worse off than others in this scenario, but all are at risk. Just as chronic unemployment can have a “scarring effect” on youth -- leading to lower lifetime earning prospects and higher rates of depression -- trading down can also have a lasting impact on careers. Studies have shown that if young people accept a lower skilled job at the beginning, they can have trouble shifting to better jobs when the economy picks up.



“You have to question whether this generation can ever aspire to a better standard of life than their parents had,” said Mr. Bell. “The opportunities for permanent employment, with long term prospects, have diminished massively.”

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