1. One Step Forward, Two Steps Backwards? Youth Are Facing an Uncertain Future

The COVID-19 crisis has had an unprecedented impact on societies and economies. From the eldest to the youngest citizens, the implications of the pandemic are affecting all age-cohorts. Although young people1 are less-at-risk than others in terms of direct health impacts, they are hit hard by the social and economic consequences as recognised by the OECD Economic Outlook 2020 (OECD, 2020[1]). Already prior to the pandemic, average youth unemployment (aged 15-24) across the OECD was 11.7% compared to an average of total unemployment of 5.4% in 2019. Since the onset of the crisis in February, youth unemployment rate (people aged 15 to 24) has increased 4.9 percentage points, which is more than twice as large as for the over 25-year-olds (OECD, 2020[2]).

In the effort to contain the spread of the virus, OECD countries have implemented nation-wide lockdowns and social distancing measures that have disrupted all aspects of daily life. From school and university closings, to the termination of part-time and student jobs, the pandemic has exposed young people’s vulnerability in the labour market and resulted in a loss of jobs and income, which risks to negatively impact young people’s future career trajectories. As youth often fill positions in non-standard forms of employment, they also have fewer financial reserves to fall back on, which increases their risk to fall into poverty and rely on governmental welfare programmes for extended periods. Findings from the OECD Policy Paper “Youth and COVID-19: Response, Recovery and Resilience” further demonstrate that young people are most concerned about the impact of the pandemic on mental health, education and employment (OECD, 2020[3]).

The pandemic hits OECD countries at a moment when many younger people have barely recovered from the repercussions of the 2007-08 global financial crisis. Across the OECD, the 2007-2008 crisis left 15 million young people unemployed, and 1 in 10 jobs held by people aged under 30 were lost (OECD, 2020[4]). In the four years following the onset of the crisis, young people (aged 18 to 25) suffered the most significant loss of income compared to any other age cohort (OECD, 2014[5]). Only in 2017, almost a decade later, the youth unemployment rate retracted to pre-crisis levels (OECD, 2020[4]). Following the slow recovery, youth continue to face significant challenges. For instance, as of 2018, young people are 2.5 times more likely to be unemployed than people aged 25 to 64 (OECD, 2018[6]). Moreover, 10.9% of youth are not in employment, education or training (NEET) – a slight recovery from 13.2% in 2010 (OECD, 2017[7]).

Both the global financial crisis and the COVID-19 crisis hit youth to vastly different extents. Young people are a heterogeneous group such that other identity factors than age co-determine their specific needs and vulnerability, including their sex, socio-economic background, health, ethnicity, and whether they live in an urban or rural context. Existing inequalities within the same age cohort can be as large or exceed inequalities between different age cohorts indeed. However, as diverse as young people and their concerns are, they are sharing the experience of re-occurring crises and new uncertainties due to a number of global transformations, which will be discussed in detail in the next section. Despite high-level international commitments2 that put young people at the centre of political attention such as the World Conference of Ministers Responsible for Youth 2019 in Portugal, G20 Antalya Declaration and the focus on “youth empowerment” in the 2020 G20 agenda, as well as the “Youth Employment Support” adopted by the European Commission, structural challenges to young people’s empowerment and intergenerational justice persist.

The 2018 OECD Youth Stocktaking Report demonstrates that public governance matters to build social cohesion and resilience across all age cohorts. Indeed, laws, policies, the capacities of public institutions and the way governments and public administrations make decisions and allocate public resources have significant consequences for the opportunities available to youth and future generations. Most notably, governance matters to support young people in their transition to an autonomous life and in their relationship with government. It also shapes the relationship between different age cohorts and the perception of whether policy-making is considered “fair” from a generational perspective.

This chapter will discuss some of the most significant global trends and context in which governments attempt to empower youth and promote intergenerational justice. It will apply the OECD Governance Framework for Youth Empowerment and Intergenerational Justice (see Figure 1.1). At the outside of the triangle, the figure displays the main policy objectives (i.e. transition, trust, intergenerational justice). At the inside, it sets out the governance arrangements put in place by governments to achieve these objectives. For the purpose of this report, the analysis focuses on the legal frameworks, institutional capacities and co-ordination, the existence of a whole-of-government policy, mainstreaming tools and mechanisms to encourage youth engagement in public life and their representation in state institutions.

The context in which young people today are coming of age is significantly different from the circumstances in which todays middle-aged and elderly grew up. Some indicators point to significant improvements achieved over the past decades. For instance, in 2019, the share of young adults (25-34) obtaining a Bachelor’s degree across OECD countries hit a record high of 24% (OECD, 2019[8]) and digital technologies have enabled youth to build new partnerships and friendships across borders. In 2019, young people across OECD countries expressed a positive outlook into their own future. When asked to rank their view of their own future on a scale from 1 to 10, youth (15-29) chose a 7.8 rating on average3. However, a survey conducted by Eurofound among countries in Europe in April 2020, on the onset of the COVID-19 pandemic, demonstrates that notable differences persist: while employed youth were most optimistic (50%), unemployed and self-employed were significantly less optimistic (26% and 43%, respectively) (Eurofound, 2020[9]).

At the place of following the traditional pathways of transitioning to an autonomous life, the life trajectories of contemporary adolescents and young adults today are more diverse. Most notably, today, young people are marrying later and less, and invest more time in education (Vespa, 2017[10]). Some of these changing attitudes are voluntary and based on altering societal norms and values. Others, however, are rooted in the social and economic hardship young people have experienced over recent years, which make it more difficult for young people to achieve some of the classical milestones of adulthood, such as financial independence, a decent job, house ownership, and parenthood (Côté and Bynner, 2008[11]). For instance, in 2013, following the global financial crisis, 73% of young people in the EU aged 18-24 still lived in the same households as their parents (Őzdemir, Ward and Zolyomi, 2014[12]). Findings from OECD Youth Governance Surveys show that responding youth organisations based in OECD countries are the least satisfied with governments’ response to housing compared to any other policy area (see Chapter 2).

As the next sections will demonstrate, the implicit promise that each new generation will fare better than the previous one appears to stand on shaky grounds. The notion of intergenerational justice underlies many of today’s most heated political debates, such as the sustainability of national deficits, the depletion of natural resources or the extinction of endangered species and pollution as well as climate change (see Chapter 4). It is also characteristic of debates in the field of social policy, especially due to an ageing population across all OECD countries, and frames discussions about inclusive participation in decision-making.

As recognised by the OECD Global Strategy Group in 2019, population ageing is a megatrend trend that concerns all OECD countries due to a rise in life expectancy and low fertility rates. Demographic change is gradually changing the age composition of societies. In 2018, the share of young people aged 15 to 24 made up 13% of the OECD’s total population4 compared to 16% in 19905. Whereas people aged 65 and older represented around 17% of the OECD’s population in 2018, their share is expected to increase to 21% by 20306.

While all OECD countries are ageing, the magnitude of demographic change varies significantly across borders. For instance, while the share of people aged 65 and over in Israel and Turkey is expected to increase to 13.6% and 12.6% respectively, by 2030, their share in Italy, Korea and Japan is expected to surge to 24.5%, 27.2% and 31.2%, respectively7. Demographic change raises important questions about intergenerational solidarity and the sustainability of public service delivery models as employment, labour market and social service systems were built for a younger median age population. Population ageing also reshapes the composition of the electorate and political weight of different age cohorts, which raises questions about the fair participation and representation of all age cohorts in democratic decision-making.

However, demographics are not a fate – policies and institutions matter (see Chapter 4). Indeed, a growing number of OECD countries has created dedicated institutions, laws, and public administration tools to design policies that are fit for all generations.

Inequality risks stifling economic growth and societal cohesion (OECD, 2015[13]). Inequalities persist both across individuals and households (vertical inequality) and across groups defined by their age, ethnicity, sex, race as well as other identity factors (horizontal inequality) (OECD, 2017[14]). Moreover, whereas some inequalities can be associated with age itself, other developments point to cohort effects and a deterioration of the living conditions of youth more generally over time.

Young people typically have limited financial assets, which puts those living in economically vulnerable households at an increased risk of falling below the poverty line within three months, should their income suddenly stop or decline (OECD, 2020[3]). Youth and the elderly (14%) as well as children (13%) in OECD countries face a higher risk of living in income poverty when compared to the middle-aged (10%) (OECD, 2019[15]) (OECD, 2015[13]). Youth also face a higher risk of financial exclusion, which may have broader economic consequences and limit educational or employment opportunities further. Young people also have lower financial literacy levels than older individuals: across the 13 OECD countries that participated in the PISA 2018 assessment, only 54% of students held a bank account (OECD, 2020[16]).

While differences in income and wealth are associated with age itself, OECD evidence also points to important cohort effects. Most notably, today’s generation of young people has less disposable income than older generations when they were young (OECD, 2020[17]). Income inequality in households can translate into unequal opportunities for young people and children to access quality education and health care. Contrary to their peers from wealthy backgrounds, children from lower socio-economic backgrounds tend to enter the labour market sooner and fill low-skilled positions. In the context of globalisation and automation, these workers are less likely to receive training opportunities to learn new skills, which can cause them to fall behind their peers (OECD, 2019[18]). OECD evidence demonstrates that only 20% of low-skilled workers participate in job-related training, compared to 37% and 58% of medium and high-skilled workers, respectively (OECD, 2019[18]).

Moreover, OECD evidence points to a “broken social elevator” as young people today face less favourable occupational upward mobility prospects than their parents’ generations (OECD, 2018[19]). On average, it takes over 4 generations – or more than 100 years – for someone born in low-income families to approach the mean income across OECD countries. Significant differences exist between the top performing Nordic countries Denmark, Finland, Norway and Sweden and countries with significantly less upward mobility (OECD, 2018[19]).

The transition of young people from education to employment is characterised by new challenges. OECD evidence illustrates that higher educational attainment increases the chances for employment: on average, the employment rate for young people aged 25 to 34 with tertiary education is 85%, compared to 61% for the same age cohort without an upper secondary education (OECD, 2020[20]). Nevertheless, despite an increase in the access to higher education, young graduates are struggling to find stable, decent and well-paid jobs, which delays their accumulation of savings and home ownership (Whitehead and Williams, 2017[21]). Higher costs for post-secondary education and increasing competition in the job market for non-temporary contracts are some of the challenges young people are facing. For instance, in about half of OECD countries for which data is available, tuition fees for Bachelor’s programmes increased by 20% between 2008 and 2018 (OECD, 2019[8]). Evidence also shows that the level of debt youth must shoulder at the time of their graduation has increased significantly in some countries.

Young people are growing up in a rapidly changing labour market. While globalisation and digitalisation present new opportunities, they also present new challenges for graduates and jobseekers. These changes require young people to acquire vastly different skills and competences than their parents. For instance, routine jobs and middle-skilled jobs, defined as occupations in the middle of the occupation-wage distribution, are expected to face the highest of being replaced by automated services whereas occupations that require high-level skills held by senior managers, technicians and professionals are likely to remain in demand (OECD, 2020[1]). The International Labour Organisation (ILO) warns that, in the future labour market, young graduates may be exposed to low and unstable earnings; lower social protection when hired as "independent" contractors, and lack of bargaining power (ILO, 2020[22]). Already today, around 35% of young people work in short-term contracts, or part-time employment that do not provide the same access to unemployment insurance and social protection as full-time contracts (OECD, 2019[23]). In certain countries, non-standard workers8 are 40% to 50% less likely to receive income support when they are out-of-work compared to workers in standard employment, despite being at a higher risk (OECD, 2019[23]). The lack of financial stability prompts young people to delay their entry into the labour force by postponing the end of their post-secondary education and by combining work and studies (OECD, 2015[24]). For instance, across the member states of the European Union, 11.1% of young people aged 15 to 19 (and 18.7% of 20-24 year old) on average combined evening classes with part-time jobs in 2019 (Eurostat, 2019[25]).

The broader social and economic transformations outlined above coincide with the emergence of innovative and digital forms of democratic participation, but also new threats to civic space9. As a consequence, the relationship between young people and governments is subject to fast and presumably lasting change.

In more than half of OECD countries (20 out of 37), youth’s trust in government, compared to the total population, has decreased since 2006. While some countries have seen a slow recovery over the last decade, significant differences exist between countries and age cohorts.10 Economic and social uncertainty, which have recently been magnified by COVID-19, can further erode youth’s trust in public institutions. Prolonged periods of lack of trust in government as well as other democratic institutions can lead to disenchantment with the political system, potentially eroding the legitimacy of liberal democratic institutions. Moreover, the lack of trust in the political class and in the democratic system and the rise of populism can mutually reinforce each other (Heiss and Matthes, 2017[26]).

Youth’s participation and representation in public life also remains limited. Young people tend to join political parties and participate in elections less than older people: 68% of young people went to the polls compared to 85% of people aged 54 or more across OECD countries for which data is available (OECD, 2020, p. 188[27]). Over the last decade, limited progress has been achieved to increase the representation of young people in state institutions and decision-making. Only 22% of members of lower houses of parliament are below the age of 40 in OECD countries, whereas the share of 20-39 year olds in the population amounts to 34%.11

Young people increasingly divert to non-institutionalised forms of political engagement, some of which extend beyond national borders, such as social movements and online activism (Marien, Hooghe and Quintelier, 2010[28]), partly due to their disenchantment from traditional politics (Crowley and Moxon, 2017[29]). Social movements such as Fridays for Future and online activism co-ordinated by young people to express concerns about the EU Directive on Copyright in the Digital Single Market, point to a surge of youth-led online activism. Social media platforms have been pivotal in facilitating these new forms of participation. The widespread use of social media and other online channels has facilitated the access to different sources of information. However, it has also expedited the spread of misinformation and disinformation, which pose a threat to the trust of citizens in media and democratic institutions. A Reuters Institute study illustrates that social media is the source of 88% of the misinformation in the context of the COVID-19 pandemic (Reuters Institute, 2020[30]). Digital tools are increasingly impacting young people lives’ and the way they interact with public life.

Within less than 15 years, youth have been hit by two major global crises in a context of rapid social and economic transformations. What can governments do to support young people in their transition to an autonomous life?

Chapter 2 assesses the policy and institutional capacities provided by governments to support youth in their transition to an autonomous life. It will analyse how governments set their priorities and strategically plan their interventions through national youth strategies (NYS) and compare country practices against the OECD benchmarks for a NYS that follows the principles of good governance. Moreover, it will discuss how “youth affairs” are being organised across public administrations and the different approaches set in place by governments to co-ordinate, implement, monitor and evaluate youth policy. It will also address the questions of how legal frameworks and governance tools can be designed and applied to deliver policies and services that are responsive to young people’s needs.

The effectiveness, resilience and legitimacy of public institutions depends on strong ties between today’s and tomorrow’s citizens. Yet, young people’s perception of having political influence and representation in decision-making have stalled. What can governments do to promote youth’s trust in government, and their participation and representation in public life and decision-making?

Chapter 3 presents data and research on trust in public institutions among young people, as well as youth’s participation and representation in institutionalised and non-institutionalised channels of political participation (e.g. voting in elections, working in the public administration, engagement in the policy cycle, volunteering, youth activism). Chapter 3 analyses the role of legal frameworks, governance tools and capacities in fostering a strong relationship between young people and public institutions. Through empirical evidence, it provides an assessment of governments’ efforts to engage youth and their efficacy to foster a more inclusive, prosperous and active relationship between young people and public institutions.

The fair distribution of public resources is crucial for social cohesion and equal opportunities across all age cohorts. However, the implicit promise that each generation will fare better than the previous ones stands on shaky grounds. What can governments do to ensure a fair distribution of costs and entitlements across current and future generations?

Chapter 4 will discuss how governments can foster intergenerational justice (IJ) in the context of ageing societies. Concerns about a fair allocation of the costs and benefits between generations have been permeating debates on social, fiscal and environmental public policy, and increasingly do so since the global financial crisis 2007-08. In reaction, OECD countries have created new institutions, laws, policies and governance tools to integrate the concerns of today’s youth and future generations more systematically in policy-making and public service delivery. This Chapter will explore the magnitude of existing inequalities across generations and map innovation in governance to deliver policies and services that are fit for all generations.

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Notes

← 1. Mindful of the de-standardisation of life trajectories, and the constant evolution and re-interpretation of particular stages of life, the report defines “youth” as a period towards adulthood which is characterised by various transitions in one person’s life (e.g. from education to higher education and employment; from the parental home to renting an own apartment, etc.). Where possible, for statistical consistency, the report employs the United Nations' classification of "youth" as individuals aged 15-24.

← 2. In 2019, the Lisboa+21 Declaration and the EU Youth Strategy 2019-27 were adopted. Moreover, the Council of Europe's Youth Work Strategy put forth an action plan. The Consenso de Montevideo was adopted in 2013 by 38 participating countries from CEPAL (United Nations Economic Commission for Latin America and the Caribbean).

← 3. Gallup World Poll (database)

← 4. OECD Demography and Population (database)

← 5. Calculations based on OECD historical population data (database)

← 6. Calculations based on OECD Populations Projections (database)

← 7. Calculations based on OECD Populations Projections (database)

← 8. Defined by the ILO as “an umbrella term for different employment arrangements that deviate from standard employment. They include temporary employment; part-time and on-call work; temporary agency work and other multiparty employment relationships; as well as disguised employment and dependent self-employment.”: www.ilo.org/global/topics/non-standard-employment/lang--en/index.htm

← 9. Civic Space is defined as “the set of political, institutional and legal conditions necessary for citizens and civil society to access information, speak, associate, organise and participate in public life.” For more information, see the OECD Observatory of Civic Space.

← 10. OECD calculation based on Gallup World Poll (Database).

← 11. Inter-Parliamentary Union, Parline database on national parliaments (https://data.ipu.org).

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