What makes a NEET?

by Karinne Logez
Statistician, Directorate for Education and Skills

NEETS - young people aged between 15 and 29 years old who are not in employment, education or training - are a potential problem both for society and for themselves. The proportion of young people neither working nor studying offers an insight into how well economies manage the transition between school and work – better than youth unemployment rates, which do not take into account the numbers in education. It's especially illuminating when the figures are broken down into those who are still looking for work ("unemployed") and those who have dropped out of the labour market altogether ("inactive"). Particularly worrying are those in the very youngest age bracket – aged 15 to 19 – who may not have completed their secondary education and are disproportionately likely not even to be seeking work. There’s a risk they may never catch up with their better educated peers.

So what makes a NEET? And what can governments do to make sure young people successfully make the transition from education into work? The latest edition of Education Indicators in Focus suggests that there are several intertwined factors.

Is it the educational system?
As well as increasing their education participation rates, making the educational system more relevant to the labour market may help reduce NEET rates. Countries with widespread work-experience programmes, offering recognised vocational qualifications, see higher levels of young people in employment and lower NEET rates, although the effect has been more muted in this current economic crisis.

Is it the state of the economy?
NEET rates and employment-to-population ratios tend to mirror the economic cycle. When times are tough it’s harder to find a job or keep the one you have if you’re competing with more experienced workers. Fortunately, many young people react by staying on longer in education instead, so when the economy picks up, they’ve got a head start finding work. As young people are the main source of new skills in the labour force, increasing education participation rates are an encouraging trend.

Is it a cultural thing?
On average, young women are more likely to be NEET across the OECD than young men. In some countries – such as Turkey and Mexico – this effect is particularly marked. It may reflect expectations that women will be concentrating on starting a family than forging a career, particularly where young women are disproportionately inactive rather than unemployed and seeking work.

Is it an age thing?
Generally, the demographics are on the young people’s side – as the population in OECD countries age, and the proportion of young people in the population fall, both employment rates and education participation rates should increase. At the moment, economic stagnation has counteracted the effect of demographics, but once the economy picks up, young people should be well placed to forge ahead.

It’s all of these
Clearly the problem of young people dropping out of education and the labour market is a complex one with no single determining cause. However, the consequences for both individuals and society mean that it’s important to prevent young people becoming NEETs – and help reintegrate them back into work or education if they do.

For more information
On this topic, visit: 
Education Indicators in Focus: www.oecd.org/education/indicators 
On the OECD’s education indicators, visit:
Education at a Glance 2012: OECD Indicators: www.oecd.org/edu/eag2012
OECD's Actin Plan for Youth
OECD Forum 2013: Give youth a chance
OECD Skills Strategy Spotlight: Apprenticeships and Workplace Learning
OECD Skills Strategy

Chart source: OECD Education at a Glance 2013:  Indicator C5 (www.oecd.org/edu/eag.htm) to be released 25 June, 2013

Are countries educating to protect against unemployment?

by Dirk Van Damme
Division Head, Innovation and Measuring Progress (IMEP) and Head of Centre for Educational Research and Innovation (CERI)

More people than ever before now reach a level of educational attainment equivalent to upper secondary education. The available evidence is very conclusive: this level of education can be considered a minimum level to ensure a job and a living wage. As the latest issue of the OECD’s Education Indicators in Focus details, the difference in unemployment risks in OECD countries between individuals with and without an upper secondary qualification is significant. In 2010, across OECD countries, 19.1% of 25-34 year-olds without an upper secondary qualification were unemployed, compared with 9.8% of young adults of the same age who had an upper secondary qualification. And without an upper secondary qualification, the risk of poverty is looming: some 27% of people without an upper secondary education earn less than half the median income – around 10 percentage points more than the proportion of people who do have that level of education.

The negative effects of lacking an upper secondary qualification are excacerbated during the crucial phase of transition from education to work. Among NEETs  (not employed nor in education and training) in 2010, there were 8 percentage points more 20-24 year-olds without an upper secondary education than 20-24 year-olds with that level of education. In 2010, in Estonia, France, Ireland, the Slovak Republic and Spain, at least 25% of the 20-24 year‑olds who had not attained an upper secondary education were neither in school nor employed.

So, countries have very good reasons to ensure that as many young people as possible graduate from upper secondary education. Over the past decades almost all OECD countries have seen dramatic increases in educational attainment from one generation to the next. The average difference between the 25-34 and 55‑64 year‑old generations in OECD countries was 20 percentage points, but in Chile, Greece, Ireland, Italy, Korea, Portugal and Spain the difference was 30 percentage points or more.

Most OECD countries – especially European ones – have increased their upper secondary graduation rates over the past ten years. As the graph above indicates, this trend coincided with declining numbers of 20-24 year-olds who were neither in education nor employed. But the start of the economic crisis in 2008 was a turning point: the size of the NEET population started to swell again. The wage gap between people with an upper secondary qualification and individuals with a tertiary level qualification increased. The evidence suggests that the crisis has accelerated job polarisation based on skills levels. People without an upper secondary qualification are highly vulnerable to unemployment, while those who have an upper secondary education are working for less money. In today’s unstable economy, an  upper secondary qualification no longer provides sufficient insurance against unemployment and low income.

For more information
On this topic, visit:
Education Indicators in Focus: www.oecd.org/education/indicators 
On the OECD’s education indicators, visit:
Education at a Glance 2012: OECD Indicators: www.oecd.org/edu/eag2012 
On the OECD’s Indicators of Education Systems (INES) programme, visit:
INES Programme overview brochure
Chart source: Education at a Glance 2012: OECD Indicators, Indicators A1 (www.oecd.org/edu/eag2012).