Getting young Greeks back to well-paying jobs will take Trojan efforts from Europe’s leaders

The news that European leaders will gather in Berlin for a major summit on tackling youth unemployment tomorrow has generated little hope among young Greeks – affected by the highest unemployment rate among under-25s age cohort in the euro zone – that they will find themselves in secure jobs paying living wages any time soon in their own country.

“The situation here is terrible. Finding a job in the business sector started getting difficult in 2007, but in the last three years it has been total chaos, with nothing available that pays more than €500 a month,” says Christos Simantirakis, a recent economics graduate who has just turned 25.

He’s long given up on the possibility of finding a job commensurate to his degree and his minimum expectations of a decent salary, with a glance at his social circle, confirms the scale of the problem facing him and his peers.

“Out of the 20 or so people I hang out with, seven have work, most of them in cafes or in fast-food delivery, where they are paid very little. Two have set up their own businesses and only one has a pretty good job – he works in shipping, but only earns €900 gross a month,” says Simamtirakis, who lives in Athens.

Forced to emigrate
Like many of his contemporaries, he's now resigned himself to fact that he will have to emigrate, once he's completed his compulsory one-year military service. A postgraduate degree in finance or banking in the UK is on the cards and he expects circumstances will dictate he'll end up staying there.

“I really feel bad about leaving Greece. I wouldn’t mind returning to Greece if there was something worthwhile here to do,” he explains, predicting that Greece won’t make a recovery for at least a decade.

In one of the most alarming Greek statistics of many thrown up by the crisis, Greece now tops the euro zone’s unemployment tables overall and in the politically and socially explosive category of youth.

According to the country’s statistics service Elstat, the unemployment rate for the under-25s was 60 per cent in the first quarter of this year, more than twice as high as the overall figure of 27.4 per cent.

But when one probes the figures by looking at the unemployment ratio that seeks to determine how many of under-25s are looking for work but can’t find it, the data appears less stark, with 71.3 per cent deemed inactive, or not looking for work, and 17.2 per cent classed as unemployed. Nevertheless, only 11.5 per cent are recorded as having jobs.

The controversial move last year, dictated by the Troika as part of the country’s second bailout memorandum, to reduce the minimum wage in the private sector by up to 22 per cent for all employees (or €586 per month gross) — and by 32 percent for those under 25 (€511 gross) — has failed to stem the jobs haemorrhage.

The low salaries are also frustrating many of the efforts at the county’s employment agency OAED to get people back into the workplace, where there two programmes available to unemployed youth.

Under one, aimed at offering work experience to 16-24 year olds over two years, applicants can expect to bring home only €341 net per month – 80 per cent of the minimum wage — with OAED covering the social insurance costs.

As Dimitris Bougiaklis, who heads the agency concedes, the wages are “very low” and, as a result, the option is not very popular.

In the second, more successful, work-experience option, open only to third-level graduates under the age of 35, participants can expect to bring home the applicable minimum wage for their age. The bonus for employers is an OAED subsidy that covers the wage and some of the social insurance contribution.

Another plank in OAED’s approach towards youth unemployment is developing and expanding, in terms of capacity, quality and market relevance, its existing dual system of apprenticeships, which, like the German model, combines theoretical courses in schools with practical training in the workplace.

Cost of living too high
Even though apprentices receive only about €300 a month, each year the system attracts more applications than the 10,000-12,000 places available, says OAED's Nasia Theodoridou, who adds: "Our main target is to provide a place for every applicant and we are working with employers to secure that."

She explains that with the help of experts from the German, British and Swedish jobs agencies, OAED is now working on reforming the curriculum to make it more applicable to the labour market, with the involvement of employers. Another plank of the reforms under way is to allow young Greeks interested in certain specialities carrying out their apprenticeships in Germany.

But OAED’s programmes hold out little in terms of prospects for graduates like Simantirakis.

“Taxes remain too high for businesses and individuals. The cost of living also also too high. Greece is not a cheap country and many employees are simply not able to pay their taxes, rents, electricity or supermarket bills with the low incomes on offer.”