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Youth unemployment in Europe is especially confounding in Greece

Matthew Schofield - Knight Ridder Newspapers

April 28, 2006 03:00 AM

ATHENS, Greece—Kostas Raisakis—DOCTOR Kostas Raisakis—hoped when he went to medical school that he'd become a symbol of Greek prosperity. But today he's an unemployed cardiologist, still living with his parents at age 36.

It's not at all what he expected. "I believed the biggest problems I'd have would lie in having too many choices," he said. "I never dreamed of the reality: that there would be no choices."

Raisakis' story is more and more the tale of what's going wrong with Europe's job market. Since graduating from medical school, Raisakis has been able to find only minimum-wage jobs at area hospitals. Now he's back in school, hoping more training will help him find work.

"Like every Greek mother, mine wanted a doctor or a lawyer," he said. "It's the dream. It's not what it is built up to be."

Youth unemployment is the talk of Europe. The topic was brought to the fore by weeks of street demonstrations in France over a government proposal that would have made it easier for businesses to fire young workers—in hopes that the looser limits would encourage business owners to take the chance of hiring them. The demonstrations stopped when the government caved last month and dropped the plan.

But France isn't the only place plagued with high youth joblessness. In Germany, especially in the old East, young people are almost uniformly pessimistic about the future. In Poland and Slovakia, nearly 1 of every 3 persons younger than 25 is unemployed.

Greece, however, may be Europe's most confounding situation. Despite a number of positive signs, and general optimism about near-term economic prospects, more than 1 in 4 Greeks under age 25 is unemployed.

Kyriakos Mitsotakis, a Greek member of Parliament who at age 38 is the latest generation in one of his country's three dominant political families, blames an outmoded educational system.

"We're focused on yesterday's economy," he said. "We have too many doctors and lawyers. The public sector and textile jobs of the last generation don't need the same number of workers they once did, yet that is where we're preparing to send people. At the same time, sectors within the private economy are booming right now. We're not producing people who can fill those vacancies."

Overall, Greece's unemployment rate—about 9.6 percent—is not that different from the rest of Europe. Germany's is about 9.5 percent, France's 9.2 and the average in the European Union is 8.6.

But while the overall unemployment rate has dropped in Greece from 9.9 percent a year ago, the rate among people 25 and younger has climbed, to 26.4 percent from 25 percent in February 2005. That dwarfs the EU average of 18.5. And while it trails the rates of Poland (35.6) and Slovakia (30.6), those nations have come into the EU only recently and have significantly higher overall unemployment.

Many said the Greek situation was especially troubling because the economy was otherwise showing positive signs. Real gross domestic product has been growing at almost twice the EU average for the past 10 years—triple the rates in Germany and Italy—and business investment is well ahead of the EU pace.

Yet young people can't find jobs, something economists fear might become a long-term problem. "If not addressed, in 10 years our unemployed young people will become unemployed middle-aged people," said Nikos Koutsiaras, an economist at the University of Athens.

Koutsiaras cites the strength of the Greek family as one of the country's major problems. The family network is so strong, he said, that young unemployed people don't feel desperate to retrain, relocate or reinvent themselves. They're supported by their families and content to wait for jobs.

The second problem is more traditional: "Our educational system is focusing on irrelevant skills," he said.

Greece, too, has been affected by globalization. The textile industry, which has been Greece's top business since World War II, when British textile factories fled here for cheap labor, has fallen victim to competition from China and elsewhere.

Greeks are hoping to persuade a Chinese shipping company to set up shop in the port of Piraeus to distribute Chinese-made textiles and other goods in the Balkans, Italy, Austria and beyond. Many will have been made with Greek cotton, though not by Greek hands.

"At least if we become their port into Europe, we'll create some jobs, some activity," said Lambrous Choulis-Choulidis, who recently shut down his blanket factory, which had employed 1,100 Greek workers. "We can't compete with China. The age of mass production in Greece, and in Europe, is over."

How to replace those jobs is something Greek officials have yet to decide.

The classic example is tourism. In the 1980s, then-Prime Minister Andreas Papandreou famously noted, "Greece will never be a nation of waiters."

That attitude, spoken when Greece was at the height of its textile boom, still guides actions here: Even though tourism is flourishing, there's still no tourism school in the country.

Many young people recognize that international competition is thwarting their hopes for success.

"Is there a future here?" asked Christos Lefakakos, 21, who's seen his work repairing oil tankers dry up as companies move ships to ports in Turkey and Egypt, seeking lower labor costs. "Maybe if we change. But I haven't had work for months."

———

(c) 2006, Knight Ridder/Tribune Information Services.

ARCHIVE GRAPHIC on KRT Direct (from KRT Graphics, 202-383-6064): 20060330 young unemploy

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