International Labor Organization predicts future lost generation

The ILO has released figures indicating that the recession is already affecting the rising generation. This press release is a pretty gruesome document, indicating nothing good for kids about to take the big step into the abyss of the employment market.

The ILO press release states:

Youth unemployment rates increased by 4.6 percentage points in Developed Economies & the European Union between 2008 and 2009 and by 3.5 points in Central & South-Eastern Europe (non-EU) & CIS. These are the largest annual increases in youth unemployment rates ever recorded in any region. The youth unemployment rate of 17.7 per cent in 2009 in the Developed Economies & European Union is the highest the region has seen since regional estimates have been available (since 1991).

The real damage is therefore yet to come. The brutal fact of this situation is that in big economies like the US, the recession is quite capable of literally putting a generation on the scrapheap. The mechanics of this process are murderously simple: 1. Delay in finding jobs sabotages the currency of experience and qualifications. 2. Uncompetitive resumes are often created by a range of ad hoc jobs outside qualifications. 3. Job options are therefore curtailed, forcing people down the ladder into less remunerative jobs. After a few years out of the loop, the job seeker is way behind the job market, their peers and new graduates. They’re uncompetitive, and worse, their CVs look like patchwork, no employment consistency and little depth in any particular field of employment. This means that by 30, a job hunter in the 18-24 age bracket now could be in a very bad position. Worse, debts from college loans and/or just staying alive are the natural stress factors. Credit ratings are destroyed, and buying a home isn’t likely to be on the radar. Economically, that means a major hole in a big economy. A generation which simply can’t even go through the basic motions of the normal cycle of productivity means a gaping pothole in Main Street. The income and productivity they would have generated is lost, both to themselves and the wider economy. It's a brake on growth, camouflaged by the next wave who fill the employment figures but mask the dropouts. There are further well known risks in the “generational” cycle in which many middle class kids fall out of the suburban tree into a void which is all too familiar. It's like losing your seat on a long distance commute. The disadvantages created by the situation persist throughout their working lives. Their kids, in turn, are disadvantaged. The net effect is a step backwards, socially and economically. The United State jobless weren’t exactly on a picnic prior to the recession. This is a tough, neurotic employment market by world standards. It’s unsympathetic and ferociously competitive, even in good economic conditions. At present, it’s a No Man’s Land of occasionally twitching job ads erratically producing a very limited number of meaningful job opportunities. Presumably welfare offices won’t be posting “Abandon All Hope” signs on the doors, but if they did, nobody would be asking why. The US is now facing a threat from a future which hasn’t been written yet, but is already spraying a lot of nasty looking graffiti on the horizon. The classic economic view of the choice for government and business is stark enough: Either get this generation out of the hole it’s falling into, or pay the price in the lost capital they would have generated and the inevitable social problems this situation will create. The good news, such as it is Historically, "lost generations" form a demographic group which progresses to pension age in the same condition. Opportunities are denied, and these groups effectively stagnate in lower income brackets, often for very long periods. The Great Depression went on for 10 years in the job market, with illusory booms in the stock market used then as now as cosmetic proof of economic improvements. There's only one wild card in the deck for this generation at the moment, but it's a good one: The New Economy. The more flexible types of employment can pay well, and allow for multiple income streams which the old economy can't provide. That means a patchwork of part time work and online job contracts can make up the gaps, and in some cases lead to better jobs than the Old Economy 9 to 5 one trick wonder treadmill. There is a way out for the lost generation, but it's a tough one. A combination of additional qualifications to avoid "CV stagnation" and open up new opportunities can make a big difference in finding New Economy jobs. Provided they don't stand still in the job market, the lost generation does have a working chance of getting itself out of this situation.