Economic development, growth and employment

Combating unemployment and underemployment

Vocational training for underpriviledged young people in Hanoi, Viet Nam.

Unemployment and underemployment are two of the main causes of pov­er­ty among broad sections of the popu­la­tion of de­vel­op­ing coun­tries and transition states. According to the figures of the In­ter­na­tional Labour Organization (ILO) more than 200 million people around the world are unemployed. Women and young people are dis­pro­por­tion­ate­ly frequently hit by un­em­ploy­ment, under­em­ploy­ment and poor working con­di­tions (the "working poor" as they are termed) – and all too often there is no social safety net in place.

The global financial and economic crisis has exacerbated these problems. The world is facing the challenge of creating more than 600 million new good jobs over the next ten years, if we are to be in a position to offer the young people flooding onto the labour market decent em­ploy­ment.

Economic de­vel­op­ment is an essential precondition for over­com­ing un­em­ploy­ment and under­em­ploy­ment. It must, however, be taken into account that the reasons for an un­satis­fac­to­ry em­ploy­ment situ­a­tion are many and diverse, and vary from one coun­try to another. They can include constraints on both the supply and the demand side of the labour market, as well as ineffective labour market institutions and un­favour­able economic conditions on the ground.

The integrated approach adopted by German de­vel­op­ment co­op­er­a­tion

Germany supports the governments of de­vel­op­ing coun­tries and in­ter­na­tional orga­ni­sa­tions in designing and realising employment-oriented de­vel­op­ment strategies. German de­vel­op­ment co­op­er­a­tion pursues an integrated approach to employ­ment promotion, which essentially embraces three mutually determining and complementary aspects:

  • The creation of decent, new, productive jobs, with support consisting primarily of the delivery of economic-policy advisory services, private sector promotion measures and financial systems de­vel­op­ment
  • Improving the employability of job-seekers by providing vocational training and upgrading, including programmes that address specific problem groups (e.g. non-formal training courses for disadvantaged young people)
  • Improving the way supply responds to demand on the labour market with the help of effective career guidance services and vocational orientation, placement services and labour market information systems.

It is im­por­tant to coordinate these three aspects of the integrated approach, and to make them part of a comprehensive economic-policy framework for employment promotion.

German de­vel­op­ment co­op­er­a­tion does not aim merely to generate more jobs in co­op­er­a­tion coun­tries. It also intends to improve the quality of the jobs available. Those working in the informal sector in particular are frequently forced to work under dangerous conditions that constitute a health hazard. The essential legal framework is not in place and workers have few opportunities to demand their rights. As a general rule their income is not sufficient to allow them and their families to live in dignity. In line with the In­ter­na­tional Labour Organization’s decent work concept, the German gov­ern­ment thus endeavours to step up social welfare provisions, ensure that core labour standards are respected, and improve the dialogue between employers and the workforce as well as merely promoting employment.

A very special target group – young people

Around the world, two out of five job-seekers are under the age of 24. Rates of youth unemployment in many coun­tries, including the Middle East and North Africa, are worryingly high. Over the years to come, this problem is set to worsen, as increasing numbers of young people flood onto the labour market, some of them highly qualified.

This youth bulge in many of the co­op­er­a­tion coun­tries of German de­vel­op­ment co­op­er­a­tion must not be allowed to result in the social and economic mar­gi­na­li­sa­tion of young people, and to their in­creas­ing­ly feeling they have no prospects. Em­ploy­ment prospects must then be created for young people so as to brake migration, prevent conflicts and foster sus­tain­able economies and stable societies.

Improving the employment situ­a­tion of young people is a very special concern of German de­vel­op­ment co­op­er­a­tion. Technical cooperation alone is currently im­ple­ment­ing 40 measures worth a total of 226 million euros designed to improve the employment situ­a­tion of young people.

A variety of instruments are used. Along with the co­op­er­a­tion coun­tries, for instance, youth em­ploy­ment strategies are produced and realised. The in­for­ma­tion made available to young people on career options is improved as are career guidance services, while initial and advanced vocational training are geared better to the needs of the labour market. Germany also supports promotion pro­grammes for business start-ups and uses special incentives to encourage businesses to provide internships and jobs for young people.

For more detailed information on combating youth unemployment see the section on children's and young people's rights.

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