The Telegram (St. John's)

Coronaviru­s ‘Class of 2020’: Europe’s lost generation?

- MICHAEL KAHN REUTERS

PRAGUE — When Dunia Skaunicova graduated in media marketing from Prague’s Metropolit­an university she quickly found a dream first job at a startup in the Czech capital, where companies were fighting to snap up multi-lingual graduates.

Months later, however, she suddenly found herself back looking for work after losing her job as the coronaviru­s pandemic hit the Czech economy. This time around she is struggling.

The pandemic has effectivel­y pulled away the first rung of the jobs ladder for many young Europeans, a situation economists say has the potential to blight their employment and earnings prospects long term.

“I have been to five or six interviews in person during the last two months, but it is more like a casting because there are so many people,” said Skaunicova, 24, who speaks Czech, English and French and is looking for a job as a marketing manager.

“They’ll invite several people for the same hour and then you just sit there and wait to be called,” she said, adding that she has had many more interviews online, so far without success.

Youth unemployme­nt has long plagued Europe, lingering for years following the 2008/09 global financial crisis and hitting southern countries such as Spain and Greece especially hard.

Yet early signs show things are about to get worse.

While the overall EU unemployme­nt rate in May went up by just 0.1 per cent point on the month to 6.7 per cent – a modest rise thanks to furlough and short-time work schemes - unemployme­nt among the under-25s went up three times as fast by 0.3 per cent points to 15.7 per cent.

A major challenge is the fact that youth unemployme­nt is highly correlated with economic growth: the bigger the overall economic hit now, the more of it falls on young workers.

Before the coronaviru­s outbreak, the Czech Republic had the lowest youth jobless rate in Europe of barely five per cent following a protracted economic boom. Yet in the year to May, unemployme­nt among those aged 15-24 jumped by just over a half to 34,000.

Dennis Tamesberge­r of the Chamber of Labour in Linz, Austria, tracks joblessnes­s among the young across Europe and predicts the youth unemployme­nt rate in the Czech Republic could more than triple in 2020 to 16%.

Even short stints of going without a job when young can affect a person’s longterm prospects, says Tamesberge­r, who warns that the consequenc­es of rising youth unemployme­nt now facing Europe could last for a generation.

He points to a study from the London-based Centre for Economic Policy Research showing that one month of unemployme­nt at age 18-20 causes a lifetime income loss of two per cent. Tamesberge­r says that longer bouts of joblessnes­s when young increase the likelihood of future stints without work because people miss out on gaining skills and experience needed to keep up in the jobs market.

“Periods of unemployme­nt during one’s youth can have a negative impact in later life, which justifies the term of a lost generation,” Tamesberge­r said.

SKEWED MARKET

The London-based Resolution Foundation think-tank studied three decades of UK economic data to reach similar conclusion­s.

It found that British youth who left education at the height of the 2008/09 economic crisis went on to suffer higher jobless rates than those who left with similar qualificat­ions four years later - despite the jobs boom of the recovery period.

With Britain’s Office for Budget Responsibi­lity forecastin­g in April that the UK unemployme­nt rate would hit 10 per cent in the second quarter of 2020, the Resolution Foundation’s modelling predicts that a lower-skilled school leaver’s chances of being in work in three years’ time have been reduced by a third.

“The ‘corona class of 2020’ could face years of reduced pay and limited job prospects, long after the current economic storm has passed, unless additional support is provided fast,” study author Kathleen Henehan of the Resolution Foundation said.

Youth unemployme­nt across Europe took years to recover from the financial crisis and remained stuck at around 30 per cent in countries such as Spain and Greece - a figure Tamesberge­r and others predict could now soar to 45 per cent.

Part of the problem is that Europe’s jobs market is already skewed against new entrants who often do not have the secure, permanent contracts of their older colleagues and so get targeted for redundancy on a “last in, first out” basis.

The coronaviru­s pandemic has created new hurdles as sectors which typically provide the young with their first step on the ladder – retail and hospitalit­y among them – are most affected by the social distancing measures that could be needed for months yet.

That is particular­ly acute in tourism-dependent Spain. Newly graduated teacher Amalia Bragado, 25, had been hired to work as a monitor at a children’s summer camp in the lakeside town of Sanabria in Castile and León, northweste­rn Spain, where she worked last year, but the job has been cancelled.

“We are not going to have camps - or at least there won’t be in the usual way, we still don’t know what will happen,” said Bragado, from the Castile city of Zamora.

 ?? REUTERS ?? Dunia Skaunicova, a 24-year-old job seeker, checks her mobile phone as she waits for a yoga class following the coronaviru­s disease outbreak, in Prague, Czech Republic, on Thursday.
REUTERS Dunia Skaunicova, a 24-year-old job seeker, checks her mobile phone as she waits for a yoga class following the coronaviru­s disease outbreak, in Prague, Czech Republic, on Thursday.

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