What’s the secret to one country’s low youth unemployment?


Why is it that some areas suffer from higher levels of youth unemployment than others? One European country that bucks the trend has some lessons.

Australia’s youth unemployment hotspots were revealed earlier this year in a Brotherhood of St Laurence report that analysed ABS labour force survey data. It showed that in four regional areas, the number of young people out of work hovered above 20 per cent. The worst performer – in the outback of Queensland and including the mining centre of Mount Isa – the rate reached 28 per cent. This compares to the national youth unemployment rate of 15- to 24-year-olds, at 12.2 per cent.

While these figures are troubling, the eurozone, where youth unemployment is running at just over 21 per cent, would gladly swap places with Australia. However, one region – Bavaria in southeastern Germany – bucks the trend. Earlier this week, The Guardian newspaper dug deep to find out why.

The largest state in Germany by land mass and the second most populous, Bavaria has a youth unemployment rate of 3.4 per cent – the lowest in the entire eurozone. Like other eurozone countries, Germany has an ageing population, but Bavaria has the highest number of 15- to 24-year-olds in residence.

Focussing on Freising, a district of Upper Bavaria containing Munich’s airport, The Guardian’s report reveals a broad mix of industries ranging from service-sector jobs to car manufacturing. Most are medium-sized companies, employing less than 100 employees and many are also family-run businesses.

A local job agency owner is quoted as saying that it leads to a culture where employers “care whether you turn up to work on time, but they also stand their ground and stick with their workforce when the economy hits the buffers for a while.”

A shortage of talent also means that businesses have to go that extra mile to attract staff. Theresa Fleidl, the head of HR at Munich airport, says that it is the only airport in the world with its own brewery and indoor wave-riding pool. “We want to offer our employees a world full of experiences,” she says.

Germany’s youth also benefits from specialist vocational schools for the training of apprentices – a responsibility cost shared with employers. In Upper Bavaria, these schools are thriving and growing. Instead of opting to attract qualified workers from outside the region, companies are training and moulding locally based workers to fill the jobs they need.

“In other parts of Europe, the state tries to push everyone into university, and you end up with doctors driving trucks,” Fleidl told The Guardian. “Here, we get the companies to educate their employees, and they can get exactly the workers they want.”

It’s Germany’s approach to apprenticeship training that is particularly instructive for Australia, where the numbers of people beginning an apprenticeship has slumped by 20 per cent in the past year. Apprenticeships in non-trades training – including retail, clerical and hospitality – have been in long-term decline.

While business leaders have been quick to express alarm and warn of skills shortages, none are suggesting that they might take some responsibility for training young workers themselves.

Greater education and awareness around apprenticeships would also help to redress the deficit. Research in Australia has shown that many young people are unaware of opportunities available to them when pursuing a traditional trade – and there is an image among young people and their parents that the trade pathway is primarily for non-academic males.

Increasing participation from young women, Indigenous Australians, and those of varied ethnic background could help to reduce unemployment among those groups and address skills shortages at the same time.

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Brooke Young
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Brooke Young

Totally agree that there should be greater awareness about vocational education and apprenticeships. Hopefully this VicGov initiative might help http://www.education.vic.gov.au/about/programs/pathways/skillsandjobscentres/Pages/default.aspx?Redirect=1

Chris Dunwell
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Chris Dunwell

When I was leading HR for the subsidiary of a major multinational technology firm we hired a trainee in Business Admin who achieved a Cert III qualification. Terrific young person who remained employed by us after completing their training. Not hard to do. We had about 250 people so we were not a huge enterprise. We can do this in many business functions – warehousing & distribution, facilities management, accounting, purchasing & procurement, of course manufacturing and trades. All it requires is a bit if thought about how to manage the supervision and coaching of trainees and careful selection at… Read more »

Mark Shaw
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Mark Shaw

I think George Santayana’s famous quote “Those who cannot remember the past are condemned to repeat it” may well apply here. While the German experience is certianly something to consider, in the 1980’s The (Bob) Hawke government looked to Gernany business for its “Enterprise bargaining” model. In my view what that taught us was you cannot just pick up someone else’s way of doing business and replacate it somewhere else. Instead you must take the key learnings and integrate it based on the local culture, laws etc. I caution people to do the same with the apprentice issue.

Fay Williams
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Fay Williams

For many years I have advocated that investing and increasing trade training for many reasons including youth unemployment. Every qualified tradesman or woman has the potential to be a small business.

More on HRM

What’s the secret to one country’s low youth unemployment?


Why is it that some areas suffer from higher levels of youth unemployment than others? One European country that bucks the trend has some lessons.

Australia’s youth unemployment hotspots were revealed earlier this year in a Brotherhood of St Laurence report that analysed ABS labour force survey data. It showed that in four regional areas, the number of young people out of work hovered above 20 per cent. The worst performer – in the outback of Queensland and including the mining centre of Mount Isa – the rate reached 28 per cent. This compares to the national youth unemployment rate of 15- to 24-year-olds, at 12.2 per cent.

While these figures are troubling, the eurozone, where youth unemployment is running at just over 21 per cent, would gladly swap places with Australia. However, one region – Bavaria in southeastern Germany – bucks the trend. Earlier this week, The Guardian newspaper dug deep to find out why.

The largest state in Germany by land mass and the second most populous, Bavaria has a youth unemployment rate of 3.4 per cent – the lowest in the entire eurozone. Like other eurozone countries, Germany has an ageing population, but Bavaria has the highest number of 15- to 24-year-olds in residence.

Focussing on Freising, a district of Upper Bavaria containing Munich’s airport, The Guardian’s report reveals a broad mix of industries ranging from service-sector jobs to car manufacturing. Most are medium-sized companies, employing less than 100 employees and many are also family-run businesses.

A local job agency owner is quoted as saying that it leads to a culture where employers “care whether you turn up to work on time, but they also stand their ground and stick with their workforce when the economy hits the buffers for a while.”

A shortage of talent also means that businesses have to go that extra mile to attract staff. Theresa Fleidl, the head of HR at Munich airport, says that it is the only airport in the world with its own brewery and indoor wave-riding pool. “We want to offer our employees a world full of experiences,” she says.

Germany’s youth also benefits from specialist vocational schools for the training of apprentices – a responsibility cost shared with employers. In Upper Bavaria, these schools are thriving and growing. Instead of opting to attract qualified workers from outside the region, companies are training and moulding locally based workers to fill the jobs they need.

“In other parts of Europe, the state tries to push everyone into university, and you end up with doctors driving trucks,” Fleidl told The Guardian. “Here, we get the companies to educate their employees, and they can get exactly the workers they want.”

It’s Germany’s approach to apprenticeship training that is particularly instructive for Australia, where the numbers of people beginning an apprenticeship has slumped by 20 per cent in the past year. Apprenticeships in non-trades training – including retail, clerical and hospitality – have been in long-term decline.

While business leaders have been quick to express alarm and warn of skills shortages, none are suggesting that they might take some responsibility for training young workers themselves.

Greater education and awareness around apprenticeships would also help to redress the deficit. Research in Australia has shown that many young people are unaware of opportunities available to them when pursuing a traditional trade – and there is an image among young people and their parents that the trade pathway is primarily for non-academic males.

Increasing participation from young women, Indigenous Australians, and those of varied ethnic background could help to reduce unemployment among those groups and address skills shortages at the same time.

4
Leave a reply

avatar
100000
  Subscribe to receive comments  
Notify me of
Brooke Young
Guest
Brooke Young

Totally agree that there should be greater awareness about vocational education and apprenticeships. Hopefully this VicGov initiative might help http://www.education.vic.gov.au/about/programs/pathways/skillsandjobscentres/Pages/default.aspx?Redirect=1

Chris Dunwell
Guest
Chris Dunwell

When I was leading HR for the subsidiary of a major multinational technology firm we hired a trainee in Business Admin who achieved a Cert III qualification. Terrific young person who remained employed by us after completing their training. Not hard to do. We had about 250 people so we were not a huge enterprise. We can do this in many business functions – warehousing & distribution, facilities management, accounting, purchasing & procurement, of course manufacturing and trades. All it requires is a bit if thought about how to manage the supervision and coaching of trainees and careful selection at… Read more »

Mark Shaw
Guest
Mark Shaw

I think George Santayana’s famous quote “Those who cannot remember the past are condemned to repeat it” may well apply here. While the German experience is certianly something to consider, in the 1980’s The (Bob) Hawke government looked to Gernany business for its “Enterprise bargaining” model. In my view what that taught us was you cannot just pick up someone else’s way of doing business and replacate it somewhere else. Instead you must take the key learnings and integrate it based on the local culture, laws etc. I caution people to do the same with the apprentice issue.

Fay Williams
Guest
Fay Williams

For many years I have advocated that investing and increasing trade training for many reasons including youth unemployment. Every qualified tradesman or woman has the potential to be a small business.

More on HRM