August 12, 2010— As the world prepares to celebrate International Youth Day today with a ceremony at United Nations headquarters, the International Labour Organization (ILO) is warning that youth unemployment worldwide has reached a new high, is climbing further still, and warns of the "risk of a crisis legacy of a ‘lost generation’ comprised of young people who have dropped out of the labor market, having lost all hope of being able to work for a decent living."
According to a new ILO report released today, of some 620 million economically active young people ages 15 to 24, about 81 million were unemployed at the end of 2009, the highest level in two decades of record-keeping by the organization. The global youth unemployment rate increased to 13% in 2009 from 11.9% in the last assessment in 2007.
This grim pronouncement will weigh heavily on the minds of youth leaders, U.N. Secretary-General Ban Ki-moon, and other leaders who are gathering at the United Nations this morning to launch an International Year of Youth on the theme of “Dialogue and Mutual Understanding.” “The event is an opportunity for the international community and the U.N. system to demonstrate their commitment to young people,” according to a statement by 27 heads of U.N. entities, including the World Bank.
As the ILO report shows, today’s youth need all the help the world can muster to help them find their first jobs or keep the ones they already have. But they also face other roadblocks to leading better lives. With the world now home to the largest number of young people in history, a new World Bank report on investing in youth will describe later this month the real cost to families and country economic growth when young people are left to grapple on their own with HIV/AIDS and other diseases; violence; unemployment; inequality; and a loss of faith in their ability to join the workforce, acquire new skills to increase their wages and standards of living, raise families, and become proud citizens in their communities.
Investing in Youth ‘Vital’
In the lingering aftermath of economic crisis, investing in youth is vital. In FY 2010, the Bank invested $2.3 billion to help youth with education, health, and work programs—a financing record that will chart the course for the Bank’s continuing stepped-up engagement with world youth.
In FY10, the Bank provided loans and grants to 37 countries for investments specifically helping 15- to 24-year-olds. In the last 10 years, the Bank has invested more than $9.5 billion in youth development, with Bank investments in youth 15 times higher today than they were in 2000. Ten years of work have also tripled the number of projects, from 18 in FY00 to 51 in FY10 (Figure 1). This lending reflects a steadily growing demand by countries for investments in youth.
Bank investments in youth have spanned the globe. In Kenya, a $60 million, Bank-financed project is increasing access to youth-targeted temporary employment programs and improving youth employability. In another hemisphere, a $700-million loan is improving the internal efficiency of upper secondary education in Mexico and its responsiveness to the labor market. And in another corner of the globe, the Bank is financing a nearly $1 million project to develop the next generation of Laos PDR’s hydropower and mining workforce. Across the border in Vietnam, $30 million goes toward jobs and skills training for village youths and young adults.
Support for Youth Linked to Stability
These countries are just a few of those that have chosen to invest in youth. As the upcoming Bank report will show, “investing in youth is smart economics.” For example, countries that produce skilled, healthy, and productive workers are more likely to achieve global prosperity, political stability, and broad social well-being.
Since abilities and qualities built during childhood and youth largely determine their adult lives, effective investments in young people provide important returns not only to people themselves and their immediate families—but to societies as a whole.
“Either we do nothing—and risk alienating youth from the mainstream and instilling in them a legacy of distrust and hopelessness—or we invest in the biggest source of human potential that the world has ever had, and reap the benefits of that investment through greater growth and social well-being for generations to come,” says Dr. Wendy Cunningham, a senior economist and head of the Bank’s Children and Youth Program.
The Bank’s overall lending portfolio reflects a commitment to investing in youth: In Latin American and South Asia alone, the Bank lent more than $550 million annually in FY09 and FY10, which comprises about 60% of total Bank lending (Figure 2). Similarly, different sectors across the Bank—led by education, and including social protection; agriculture and rural development; health, nutrition and population; urban development; economic policy; energy and mining; environment; financial management; public sector governance; and social development—are increasingly staking a claim in the potential of world youth.