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'The rate of unemployment among 15-24 year olds in Ireland has increased by 74% between 2006 and 2011' (Profile 3 at Work, Central Statistics Office, July 2012) - Leaving Cert Economics - Question 8 - 2013
Question 8
'The rate of unemployment among 15-24 year olds in Ireland has increased by 74% between 2006 and 2011' (Profile 3 at Work, Central Statistics Office, July 2012). (i... show full transcript
Worked Solution & Example Answer:'The rate of unemployment among 15-24 year olds in Ireland has increased by 74% between 2006 and 2011' (Profile 3 at Work, Central Statistics Office, July 2012) - Leaving Cert Economics - Question 8 - 2013
Step 1
Explain three economic consequences of a high rate of youth unemployment on the Irish economy.
Answer
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Increased government (current) expenditure: With a higher rate of youth unemployment, the government may face increased demand for social welfare support. This rises the government's spending on social services and welfare bills, further straining public finances.
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Loss on return on investment in education - 'Lost generation': High unemployment may lead to a scenario where the youth, who have invested time and resources in education, end up not contributing productively to the economy. This is described as a 'lost generation', where the country loses on the taxpayers' investment in education.
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Emigration: As job opportunities dwindle, many young individuals may consider moving abroad in search of work. This not only results in a brain drain but also diminishes the available workforce, weakening the country's economic potential.
Step 2
Discuss three measures which the Irish government may introduce to reduce the problem of youth unemployment.
Answer
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Provide more opportunities for education / training: Strengthening connections between educational institutions and the job market by ensuring that curriculums and training programs are aligned with industry needs will help equip youth with relevant skills.
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Subsidised work placements/internships: The government could create programs that offer financial support to employers who provide internships or work placements, encouraging them to take on young workers and help them gain essential work experience.
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Lower PRSI contributions: Reducing the employer's Pay Related Social Insurance (PRSI) can incentivize businesses to hire young unemployed individuals, as it lowers their overall employment costs.