Coming into working life: a key interval for younger individuals

Author: Akiko Suwa-Eisenmann (member of the Circle of Economists | professor at the Paris School of Economics)

More than an age group, young people are a social state defined by study and closed installation into adult life through access to stable employment, independent living and starting a family. In the past, these three events took place almost simultaneously. They are now spread over several years, while the studies are longer. We are also young and older, up to 28 or 30 years.

However, it should be recalled that the process of extending studies has stopped since 1995: the school attendance rate at the age of 21, which was 45% in 1995, fell to 40% in 2000 and has returned to 25 years today.

Initial deficit of professional experience

As a result of prolonged studies, young people enter the labor market with higher qualifications, but also with less professional experience, which puts them at a disadvantage in finding a stable job. In addition, young people go through a series of fixed-term contracts and periods of unemployment after graduation. The positive and protective effect of the diploma will not become fully apparent until several years later, when the initial deficit of professional practice is absorbed.

The period between studying and settling in a stable job, ie “between”, is an uncertain period: 37% of students receive a grant based on social criteria, from 1,000 to 5,700 euros per year. 40% of university students work in parallel on “odd jobs”. In rural areas, where jobs are scarce, especially for low-skilled women, the jobs at their disposal (such as a cashier or babysitter) require car travel, costly investments, which prolongs the transition period for young women living in rural areas ( Coquard, 2019).

Democratization of the school

However, it is in this “between” that young people lose the economic benefits associated with student status, such as help, free transport or reduced prices for cultural or sporting activities. Entry into working life therefore results in a temporary decline in living standards for some.

What kind of youth policy? Above all, we must renew our proactive efforts to democratize education, which has resulted in several years of interrupted massive enrollment of children from working classes to universities, then to secondary schools and universities. Then we need to combat the insecurity of young people and facilitate the transition period between studying and settling into adulthood. To this end, it is necessary to increase transfers for young people (grants, subsidies, loans due 15 years after the last diploma) by raising the ceiling for parental resources to 2.5 times the SMIC and, above all, no longer make them conditional on full-time study.

Extended duration of activity

Such budgetary efforts, especially if they take the form of young people’s income, require a rebalancing of public transfers from older people to young people, which may include extending the duration of the activity. Companies also need to adapt by attaching less importance to experience as a recruitment criterion. Finally, private transfers are redirected to young people, not by facilitating family donations that increase inequality, but by funding university or professional foundations for young people. Let’s invest in youth, the power of innovation for society!

Akiko Suwa Eisenmann, Professor at the Paris School of Economics, Member of the Cercle des Economistes

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