Ensuring that the next generation can transition into the workforce is essential to a functioning society. Unfortunately, a troubling trend has emerged in some developed European countries, where young people are being left behind. This is especially evident in Greece.

The southern European nation has long faced this challenge amid a broader economic crisis. Although the government of Greece is considering measures to address youth unemployment, the country has already seen significant improvements in employment.

Youth Unemployment in Greece

“For over a decade, Greece has held one of the highest youth unemployment rates in the European Union.” In 2009, after nearly a decade of adopting the Euro as its national currency, Greece was hit hard by the global financial crisis. As a result, the government became unable to pay off its debts. 

That exacerbated long-running problems within the Greek economy and job market, leading to the highest rate of youth unemployment in Europe. Factors contributing to this high rate include a disconnect between the private sector’s actual needs and the education system. Greece produces a significant number of university graduates in the fields of humanities and social sciences, “while the market screams for specialized technical roles and digital expertise.” 

This imbalance in the labor market leaves highly educated young people without the technical expertise needed to meet the demands of the private sector. This leaves them overqualified for jobs in tourism and retail but underqualified for upper management positions. Limited vocational training can restrict young people’s access to sectors such as construction and engineering, while low levels of youth entrepreneurship contribute to fewer start-ups.

Regarding tourism, Greece is a popular vacation destination, with a large tourism industry that generates significant revenue. However, the tourism industry can be seen as a double-edged sword. Most work in tourism is seasonal, which presents a problem for long-term financial planning and career progression. 

Many young workers are caught in a cycle of short-term, six-month contracts. This limits their ability to plan for the future, including securing a mortgage or starting a family. Seasonal work also rarely provides the professional development needed to move into stable, high-paying corporate roles.

Improvements and Potential Solutions

As the problem has persisted, the Greek government and other parties have remained divided over the issue and have tried to implement policies to address the needs of Greece’s youth who have been left behind. Just this year, Greece introduced reforms to its tax code that lowered the overall tax rate by two percentage points. The reform also offers additional tax breaks to younger workers and families, with rates as low as 9% for families with three children and zero income tax for those with four or more children.

Reforms like this can provide some extra brevity for those looking to enter the job market, as well as making it more manageable for those who want to start a family in the future. Other taxes that are reduced include the property tax for villages with fewer than 1,500 residents and an overhaul of provisions for short-term renting. Another proposal, detailed by the European Student Think Tank, calls for “Setting up regional offices for counseling and networking, especially in rural regions with high youth unemployment, as part of an effort to enhance entrepreneurship skills, knowledge of the Greek market and social skills of youth.” 

From the proposals already passed, it is evident that there has been a substantial improvement in youth employment. According to Prime Minister Kyriakos Mitsotakis, “Greece used to be at the bottom in Europe in unemployment of young people with 39.5% in 2019, but that rate has dropped to 13%.” That is a substantial improvement, yet there is still much work left to be done.

Final Remarks

Recent reforms to the tax code, property laws and economic policies have greatly improved the prospects of young Greeks. They now have the opportunity to begin a new chapter in their lives as professionals, rather than remain stagnant in a tourist economy that kept them from advancing. 

– Alexander K. Petrov

Alexander is based in Boston, MA, USA and focuses on Business and Technology for The Borgen Project.

Photo: Flickr