Essay on Youth Unempoyment

1080 Words Apr 28th, 2014 5 Pages
4. Identify the causes of youth unemployment in a country of your choice and evaluate the government policies used to reduce this problem.
The issue of unemployment has been in great focus since the Great Recession took place in 2009. It is one of the leading costs to the economy in terms of inefficient production, but social costs such as monetary inequality, crime rate and poverty must be taken in account as well.
Fig 1: Eurostat, 2012,

Being one of the most severely influenced by the crisis above all EU countries, Spain has a staggering 20% overall unemployment rate and 50% of the amount are youth. (Sinitsky, 2013) The reason for this astronomical
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With reference to Figure 2 above, employment policies are more stringent as the Employment Protection Index increases. (Aceleanu, 2013) We can determine from this graph that the industrial regulations in Spain are highly inflexible, which also means the existing employed workers are protected under the Act, making it hard for employers to dismiss them.

Government Policies
Special Self-Employment Regime: Régimen Especial de Trabajadores Autónomos (RETA)
The local newspaper in Spain reported a significant increase of entrepreneurs of 4,867 to 3,050,798 in March 2012, when a special self-employment regime (RETA) was introduced. (, 2012) It subsequently led to an improved RETA in Mid-2013 to encourage entrepreneurship alongside with measures like the Entrepreneur’s Act (11/2013). The enhanced regime reduces social security contributions for a specific time period from registering as a self-employed person, complete access to reimbursements to assist costly investments and even incentives for current employers to hire youth. (, 2013) However, a recent report found added complications that hinder the growth of incoming entrepreneurs like raising the rates of social contributions, making financial difficulties for them. (, 2014)
This governmental policy is proven to be an effective method to support

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