By the Blouin News Business staff

Will the E.U. tackle youth unemployment–finally?

by in Europe.

Protesting students carry a cardboard skip opposite Downing Street on March 16, 2011 in London, England. Getty Images.

Europe’s youth unemployment has reached such a catastrophic and distressing level that European Union leaders can’t hide from it anymore. Across the 27-member union, 5.8 million people under 25 were jobless as of November 2012. With no effective measures taken to date to counter it, the numbers only grow, especially in Spain and Greece, where more than 50% of young people are without a job. In Italy, Portugal, Ireland, Bulgaria, Cyprus, Latvia, Hungary and Slovakia rates are around or above 30%.

Beyond the immediate human cost, the danger is that the situation becomes permanent. There are two implications: one is the ever growing possibility of creating a lost generation; the other is that young people will continue to be forced to leave their country in search of opportunities. Both have horrendous long-term implications for the productive economic capacity of the countries they come from. The global consequences of youth unemployment are even worse.

Young Europeans out of the work force or soon-to-be jobless may have a reason to believe it won’t get worse. February might just be a turning point in the way European institutions tackle their plight. European Commission president Jose Manuel Barroso is promoting a Youth Guarantee scheme, which aims to ensure that all young people are offered a job, training, an apprenticeship or further full-time education within four months of leaving formal education or of becoming unemployed. His plan was first presented in December. Since then it has received support throughout Brussels.

The most important hurdle it faces comes next week. On February 7-8, the EU holds a summit to agree its multi-annual financial framework (MFF), effectively the EU’s budget for 2014-2020. It is likely that the Youth Guarantee scheme will receive some funding out the budget allocated to the European Social Fund, but how much is the question. Some countries want the fund to be increased, others want it cut, in accordance with their stance on austerity stance.

For the scheme both the size of the pie and the size of the slice it will get are open questions. The fear is that there might be no new pie at all for a while. Next week’s budget summit follows the collapsed attempt in November. There are worries that failure could happen again. Should it do so, EU leaders would have until the end of 2013 to agree on the budget. No agreement by then would mean rolling over the 2013 budget into 2014 on a month-by-month basis.

The consequence of a political failure to reach a deal on the MFF would throw doubt–one of the biggest fears in the EU–on the hundreds of billions of euros in public investment to which real jobs and incomes are attached. That could lead to more unemployment and less job creation. Once again youth would be hard hit.

A sign of encouragement for Europe’s jobless youth is that European leaders have been talking more about the need and willingness to deal with youth unemployment. “We have to open up new perspectives and introduce certain bridging measures that will then allow the [current] reform processes to take place without unduly disturbing domestic policy,” German chancellor Angela Merkel said in her Special Address at the World Economic Forum.

Barroso, for his part, told members of the European parliament, “In 12 of our 27 member states youth unemployment is higher than 25%. And some of our Member States face a genuine social emergency.” He believes the Youth Guarantee scheme fits the bill because of the “need to tackle the problem of unemployment at a European level.”

The words of Merkel, Barroso, and the EU’s commissioner for economic affairs, Olli Rehn underline the importance and urgency the issue is now attracting. That it is is now being talked of in terms of short-term goals rather than long-term strategies suggest it is moving up the political agenda.

It also comes against a growing sense among European leaders that the worst of the euro crisis has passed, though as Barroso noted, “a lot still has to be done. Stabilization is not a recovery. We may have calmed unrest among markets; we have yet to raise hope among citizens.” February is the opportunity to do so for the continent’s youth.