engleski

Youth unemployment in Croatia

Despite of the economic and social importance of the issue of youth unemployment and the recent policy activism at the national and European levels with regard to youth who are not in employment, education or training (NEET), research on the issue remains somewhat thin. Sociological case-study approaches offer insights about the problems faced by youth, but they contribute relatively little on our understanding of the economy-wide processes of selection and sorting that underpin youth labour market outcomes. In turn, applied labour economics approaches offer some insights about the contribution of individual and environmental characteristics to the labour market outcomes of youth, but are often descriptive and too simplistic in their approach, often reducing the issue of labour market exclusion into a ‘binary’ selection process between employment/training and unemployment/inactivity. In this paper we try to find some middle ground between these two approaches. While adopting the methodological approach of the applied economics literature, we offer a more careful and more comprehensive analysis of the individual and environmental characteristics associated to different labour market outcomes of young people. Specifically, we identify four outcomes of interest – in employed, unemployed, in education and inactive – and examining ‘selection’ into these outcomes as a simultaneous process. Using data from the Croatian Labour Force Survey over a 12-year period, encompassing the recent crisis, we provide a detailed examination of the evolution of NEET and employment/education outcomes in the country with the third highest youth unemployment rate in the EU. Our analysis unveils a critical distinction between employment and education outcomes (and, less so, between unemployment and inactivity) showing that different environmental factors and individual characteristics contribute differently to an individual’s likelihood to enter employment or remain in education – and, inversely, that the ‘choice’ between inactivity and unemployment is to a large extend rather random. We discuss the implications of our findings with regard to policies aiming at addressing problems of labour market participation of NEETs, focusing in particular on the need for a more careful alignment, or fine-tuning, between activation and education policies (including VET).

NEET ; youth unemployment ; crisis ; education ; Croatia ; EU policy

Presenter: Vassilis Monastiriotis