Second wave of pandemic worsens young people's work prospects

BarcelonaWhen the state of alarm was declared, the plans of Irene Moreno, 23, were to finish the last year of her degree in tourism and start working in September at the travel agency where she had already done an internship. "I had secured a job, but the pandemic has changed that, and my sector has been one of the most affected," she explains. Since she received her degree she has been looking for work in any field: supermarkets, customer service, household appliance stores, fashion chains... But she has only been called for two interviews and has not been hired anywhere. "It's too complicated," she says. Until tourism picks up, she has decided to sign up for a cabin crew course that will start in January. "I'm hopeful that aviation will improve. I didn't really think about it before, but I will study until I find a job," he says.

Irene's case is no exception. The pandemic has accentuated the precariousness of youth employment and the second wave has made it even worse. One in four young people under 30 (25.3%) are unemployed, while among those above this age group the figure drops to one in ten, according to the latest data from the Spanish Labour Force Survey (EPA) for the third quarter. The data is especially worrying if we consider that a year ago the percentage of unemployed youth was six points lower. "Youth unemployment is always double that of the overall population, both in times of expansion and in times of crisis, but in the latter case it is even wider," explains Raúl Ramos, professor of applied economics at the University of Barcelona. The reason? "Because they lack experience and this makes it difficult to find work."

The unemployment rate of this group affects men and women in the same proportion, but the gap widens as age and education levels drop. Again, the data is alarming: four out of ten young people who have only completed compulsory education are unemployed, while among those with a higher level of education the percentage drops to 20%.

The situation of those with jobs does not inspire optimism either. They face two major obstacles: the string of temporary contracts and low wages. In fact, almost half have temporary contracts, a figure that stands at 14% among workers over 30. "From the moment a young person signs their first contract until they gets a permanent job, nine years go by," explains Ramos. "It is very common for them to have ten contracts a year, and this is detrimental to them, because it does not allow them to acquire the necessary experience in a specific sector," he adds.

But even young people who already have some work experience have had their careers cut short by the pandemic. This is the case of Marta Rubau (not her real name), a 27-year-old technical architect who became unemployed just before the coronavirus broke out in February. The construction company where she worked did not renew her contract to avoid making it permanent. Even so, she managed to get an interview before being let go. "They finally told me that they would give me the job and the same week the state of emergency was declared and we went into lockdown," she recalls. The next call she received was from the company's human resources department to tell her that her employment had been frozen.

Since the confinement, Marta has conducted several job interviews: face-to-face, on Zoom, by phone... All with the same result. "Vacancies are very limited. I trust the situation will improve, but not until next year," she regrets. In the meantime, she is considering studying outside her field to seek her luck in a sector less affected by the crisis. "The construction industry will have a hard time regaining confidence," she adds.

According to Ramos, during crises many young people stop looking for work because they know there is none, and this makes the unemployment rate lower than it really is. As in the case of Marta or Irene, "many find refuge in training" and others directly neither study nor work. The rate of the latter has also shot up to 16% in the third quarter of the year, 6% more than a year ago.

Labour hardships and the increase in the price of housing also make it very difficult for youngsters to leave home. In fact, according to the latest data from EPA, for the first time since 2007 the rate of young people leaving their parents' home before the age of 30 is below 20%; 13 years ago it reached 33%.

Counterproductive incentives

Is there any solution to this situation that the crisis of covid-19 has made worse? "The incentives given to companies to hire young people are a mistake because, if they're interested in their profile, companies will hire youngsters anyway. Incentives also displace older workers," says Ramos.

For Ramos, the main solution is to eliminate temporary contracts, following a model more akin to that of Nordic countries, where temporary employment is very low. "To do this, we would need a change in legislation with lower dismissal costs and a lot of education in the business sector. However, Ramos adds that severance payments cannot be touched if unemployment benefits are not adjusted. In this sense, he defends that in times of recession, such as the current one, these benefits should be longer than in times of economic prosperity. "There is no point in a two-year unemployment benefit if there is a demand for labour," he says.