Youth Unemployment in Old Europe: The Polar Cases of France and Germany By: Pierre Cahuc (Department of Economics) ; Stéphane Carcillo (Departement d’Economie de Sciences Po) ; Ulf Rinne (Institute for the Study of Labor (IZA)) ; Klaus F. Zimmermann (Bonn University (Bonn Graduate School of Economics) (BGSE))

France and Germany are two polar cases in the European debate about rising youth unemployment. Similar to what can be observed in Southern European countries, a “lost generation” may arise in France. In stark contrast, youth unemployment has been on continuous decline in Germany for many years, hardly affected by the Great Recession. This paper analyzes the diametrically opposed developments in the two countries to derive policy lessons. As the fundamental differences in youth unemployment primarily result from structural differences in labor policy and in the (vocational) education system, short-term oriented policies do not address the core of the problems. Ultimately, the youth unemployment disease in France and in other European countries has to be cured with structural reforms.
Keywords: Labor Policy; Labor Market Institutions; Great Recession; Youth Unemployment; Minimum Wages; Demographic Trends; Vocational Education and Training; Unemployment Protection
JEL: J24 J38 J68


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