The impact of the crisis on youth employment

To have an idea and according to the statistics provided by INE, new jobs with only six months of seniority fell in 2020 to 33%.

This week an important work by the journalist Sérgio Aníbal, in the newspaper “Público”, came to call attention to a recurring dilemma regarding youth employment following a crisis. According to several experts, such as the University of California economist Till von Wachter or the Portuguese Pedro Martins, also an economist and former Secretary of State for Labor in the XIX Government, there is a “scar effect” of the crises in the labor market that particularly affects workers. younger.

This means that those looking for their first job in times of crisis are forced to face “major initial effects on incomes, labor supply and wages”, effects that only tend to be diluted 10 to 15 years later.

As another economist quoted in the article concluded, the Irishman Mark Regan, after analyzing a group of 13 European countries, including Portugal, “an unemployment rate of 1% higher took, on average, 2% of the entry salary of a worker ”. In the following eight years, the same study also considers, “the penalty remains, being around 1%. Only after 10 years does the differential disappear ”.

What makes this “scar effect” even more serious in the current circumstances of the pandemic crisis are the figures shown and related to the year-on-year variation in the number of jobs, with regard to the new jobs suppressed by the crisis and the age of the affected workers.

In fact, to have an idea and according to the statistics provided by INE and made available in the mentioned article, new jobs with only six months of seniority fell in 2020 to 33%. And, as for the age of the affected workers, the difference is dramatic; minus 23,2% in the number of jobs available to workers up to the age of 24, well above the -5,2% of the second most affected group, between 35 and 44 years old.

In view of this situation, some experts have been drawing attention to the need to define public policies that make it possible to counter this “scar effect” of the crisis in the youngest and, in my opinion, this need is even greater for the case Portuguese, where the dependence on tourism and the implosion that has been verified in the hotel and restaurant market will have a radical effect on the supply of work and on the remunerations practiced.

It is evident that António Costa Silva and the Government need so much to invest in the digital transition, if Portugal wants to follow the evolution of other countries, among which Estonia is the main one. benchmarking. But we must also not forget that many “analog” activities will need incentives and creativity, in order to establish a model that allows public entities to assist or at least not hinder the lives of companies and commerce, thus enabling the impact on us. workers, and young people in particular, is not as dramatic as the statistics seem to point out.



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