About those young individuals that do not study and do not work

Publicado el 15 de mayo, 2012 | 0 comentarios | Archivado en : , , , , ,

Latin America is into its tenth year of sustained economic growth and poverty has dropped by about 51 million people since 2002.[1] Studies suggest that most poverty and inequality reduction can be explained by rapid and sizeable increases in labor income. One of the paradoxes of economic growth in Latin America is that despite greater educational and labor opportunities, there are strong rates of young individuals that do not study and do not work. This is a phenomenon known as “idle youth” (those that do not study and do not work).

Currently, 18.5% of Latin American youth between the ages of 15 and 18 (9.4 million) do not work and do not study. The interesting thing is that the highest rates observed for these age groups were in countries with very different economic and cultural trajectories:  By 2009, it represented 28% of the age group of 15 to 18 in Honduras (237.000), 25.3 percent in Guatemala (237.000), 26.1% in Peru (754.000), 20.5% in Chile (304.000), and 20.4% in Colombia (865.000). Figure 1, reveals in addition that except for the case of Peru, Bolivia and the Dominican Republic, between 50 to 60 percent of idle youth is concentrated in the lowest income quintiles (Quintiles 1 and 2).

 

Figure 1.  Idle youth by Income Quintiles LAC12 (Age Group 15 to 18)

Note: Authors elaboration based on calculations using micro data from 214 household surveys (for the years 2007 and 2008) by Cardenas et. al (2011).

 

How to explain this phenomenon, in so diverse countries and in a context of sustained economic growth in the region since 2002? Figure 2, shows a snap shot of the case of Brazil. In this figure, we observe several trends: first, there is increasing secondary school enrollment, with decreasing employment for the young population. This could suggest that greater educational opportunities are driving the young population out of the labor market. Nevertheless, we also observe that unemployment has increased by 5 percent since 1995. This trend suggests that although a lower percentage of young individuals are working, many are looking for a job and not finding one. This could explain why we also observe a steady trend of idle youth since 1995. Taking into consideration demographic growth, a 2 percent reduction of idle young would still imply that the same of more young individuals are not studying and not working.

 

Figure 2. Jobs, Schooling and Idle Youth in Brazil from 1995 to 2009

Note: Author’s own elaboration using SEDLAC – World Bank Data and the World Development Indicators.

 

Young individuals do not seem to be benefiting to the same extent as adults from increasing economic growth and labor opportunities. Indeed, recent studies suggest that Idleness is associated to factors such as extreme poverty, youth long term unemployment. More research needs to study the role of other determinants that include the consumption of risky behaviors (eg. drugs, alcohol), distance to school) teen pregnancy, violence, the number of siblings in the household or structure of the household [2].

 

 


[1] Since is taking the current 31.4% poverty rate, using ECLAC national poverty lines, and a 28% rate using the $US 4/day international poverty line. See World Bank and CEPAL.

[2] For evidence about Brazil’s idle youth see: Susana Martinez-Restrepo, “The Economics of Adolescents’ Time Allocation: Evidence from the Young Agent Project in Brazil” (PhD diss., Columbia University, 2012). For evidence about Mexico See: Arceo-Gómez, Eva; Campos Vasquez-Raymundo (2011). ¿Quienes son los NiNis en México?

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