Creating economic opportunities for young people in a changing world

By Barbara Rambousek

Creating economic opportunities for young people in a changing world

Read the speech delivered by Barbara Rambousek

Global Youth Economic Opportunities Summit in Washington

In his book Down and Out in Paris and London George Orwell wrote: “People are wrong when they think that an unemployed man only worries about losing his wages; on the contrary, a man, with the work habit in his bones, needs work even more than he needs money.” The same goes for women.                         

What Orwell points out is that unemployment or a lack of employment is a deep-seated problem which goes beyond earning one’s keep. It is especially pertinent when it comes to young people who are still in the process of adapting to the needs and opportunities of the societies they are born into.

To discuss this issue, the challenges and possible solutions, more than 500 delegates from over 55 countries representing policy-makers, businesses, youth leaders, educators and many more are gathering today for the 11th Global Youth Economic Opportunities Summit, a three-day event in Washington.

The question on the agenda is how to create economic opportunities for young people in a changing world. In this changing world globalisation, technological process and demographic changes are altering the types and value of jobs. These changes will come with substantial adjustment costs. Labour markets are increasingly polarised, and it is often women who are feeling the pressure first.

If we take a look at the EBRD region, in Egypt, Morocco and Turkey over 50 per cent of work activities are susceptible to automation whereas demand for skills is growing particularly in high value-adding formal sectors. In the Western Balkans labour markets have struggled to adjust to structural changes to service-oriented economies.

The EBRD is addressing these challenges with targeted Gender and Economic Inclusion Strategies. These provide guidance for the Bank’s operation in combining investment with creating an environment that offers greater opportunities, especially for young people, women, inhabitants of remote regions and people with disabilities.

This is especially important not only because there is massive demand for these initiatives. It also allows us to see beyond the challenges and reach out for the opportunities. New technologies and new markets will change the way we work and organise our work life. They will create alternatives for new and more productive and rewarding jobs. Workers are likely to have more flexibility about their work arrangements.

Times of change are always times of disruption. To reap the benefits we need a targeted and multi-layered approach. The EBRD is committed to the development of the private sector, which creates 9 out of 10 jobs in developing countries. We invest in the private sector to enhance the economic inclusion of young people, particularly young women. It is also the sector which can deliver the most for youth inclusion. To date, the Bank has more than €1 billion of ‎investments in projects supporting economic inclusion.

We do this in three different ways:

First, the private sector has an important role in enhancing education and providing training to equip young people with the skills needed on the labour market. State education systems alone can no longer turn out graduates who can seamlessly slot into jobs – businesses also have an important role to play. This requires a re-thinking and re-designing of more effective work-based learning models – such as internships, apprenticeships or traineeships.

It also requires the full integration of gender considerations across all activities – to ensure that young women are encouraged and are able to take advantage of the opportunities that exist.

Second, national education systems need to be upgraded through direct input from the private sector. It is necessary to define national skills standards and curricula that reflect the needs of employers. We need more effective dual-learning models and policies nationally that incentivise schools and colleges to forge direct partnerships with local employers. The promotion of inclusion also requires the institution of standards and accreditation mechanisms for equal opportunities employers.

These help companies demonstrate their credentials and track records as fair and high-quality employers and attract – and retain – qualified and motivated staff. We can help set up functioning platforms for this policy exchange. We can also bring in specific sectoral and policy expertise on inclusive practices – for example participants such as the UN World Tourism Organization who has a wealth of experience in designing and implementing inclusive and sustainable tourism policies and practices. 

Third, we need to take advantage of the opportunities that innovations in finance and investments can bring. Examples include impact financing; access to finance for non-traditional groups that lack credit history or access to collateral – such as young people, women, refugees, and others; innovative risk assessments; and the introduction and support of non-cash based payments to enhance financial inclusion.

We need to be bold but we also need to be careful. Open exchange of ideas, robust impact evaluations of what works and why, peer review of new concepts and the establishment of new partnerships will all allow us to share and disburse knowledge and best practice.

Barbara Rambousek is the EBRD's Associate Director, Lead Inclusion Economist