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Consider this—globally, 75 million youth between 15 and 24 years of age are unemployed, according to a May 2012 report of the International Labor Organization (ILO). If all these youth were residents of a single nation, that would make it the 18th most populous in the world. The 75 million youth (an increase of around 4 million since 2007) comprise about 40 percent of the estimated 207 million unemployed people across the world.

Many of those who have managed to secure some employment are not any better off. As many as 228 million youth who have 'jobs' live on less than $2 a day, a reflection of their poverty and under-employment. The ILO forecasts a bleak future too. The international body on labor projects that the global youth unemployment rate—seen at 12.7 percent this year (or higher at 13.6 percent if one includes those who have given up or put off their job search due to the poor prospects)—will remain at such high levels in the near future, that is at least till 2016.

Such is the seriousness of the problem that some experts have already started describing today's youth as Generation 'U' (for Unemployed) or Generation 'NEET' (an acronym for Not in Education, Employment or Training), a far cry from the more popularly used term—'Generation Z' or 'iGeneration' (symbolizing their skills in being technologically advanced and connected).

The global economic slowdown and particularly the ongoing Eurozone crisis are not helping either. For instance, in Latin America and the Caribbean, youth unemployment is pegged at 14.3 percent in 2011 and is projected by the ILO to stay at such levels in the medium term. Up north, the U.S. Bureau of Labor Statistics data shows that youth unemployment (18-29 years of age) was 12.8 percent in June (if those who have given up job hunting are included, the rate would rise to 16.8 per cent). Compounding this is America's cumulative student loan debt, which is estimated to be around a whopping trillion dollars. With hardly any well-paying jobs in the offing during the continuing slowdown, it has now become impossible for many to pay off the loans.

Several students are even questioning the classic ‘American Dream’ of a good education leading to unlimited opportunities, decent jobs and home ownership. The reality now is so harsh for them that education has become more of a liability than an asset.

In the other side of the Western world, the crisis of youth unemployment in Europe has assumed ‘emergency-like’ proportions. According to the latest Eurostat (EU’s statistical office) data, the youth unemployment rate in the EU has hit a record of 22.6 percent in June, while it is 22.4 percent in the Eurozone. In Spain, youth unemployment from April to June 2012 touched 53.27 percent. As a result of such high levels of unemployment, a rising number of young Spanish professionals are reportedly migrating to other countries for work. Interestingly, EurActiv.com, an EU affairs website, cited reports and stated that, “Many young Spanish and Portuguese citizens are leaving their homeland in search of better opportunities abroad, with former colonies being among the more popular destinations." Argentina, Ecuador, and Venezuela have emerged as some of the favorite locations for Spanish youth, besides the UK and Germany. Others are considering Brazil, Panama and Colombia.

From Portugal, where the youth unemployment rate has touched 36.6 per cent, youngsters are moving to its former African colony Angola (Africa's second largest oil producer) and Brazil. In fact, the Portuguese Prime Minister Pedro Passos Coelho has even exhorted the youth in the country to search for work overseas. These developments may be seen as positive, considering that some of the youth in Europe have at least not given up their search for a better life and are beginning to see the world as a playground without boundaries. Nevertheless, questions are now being raised as to whether there is a direct link between rise in long-term unemployment and the negativity that it causes—such as an increase in mental illness, drug and alcohol addiction, as well as violence among the youth; and whether all these will lead to civil unrest and extremism, in turn worsening the global economic situation.

On civil unrest, one recent example is the Arab Spring, which saw wholehearted participation of youth in those regions. The Arab Spring is seen as an inspiring contribution by the region's tech-savvy youth who dislodged longstanding dictatorships through their high-profile protests. However, it has, at least for the time being, worsened job prospects for the region's youth. The ILO report said that following the Arab Spring, youth unemployment in North Africa soared 5 percentage points to 27.9 percent in 2011, while in the Middle East the youth unemployment rate was 26.5 percent, over twice the global youth unemployment rate. Around half of Africa's 200 million youth are unemployed, according to other reports. Such economic misfortune, despite the Arab Spring inspiring "Occupy Wall Street"protests against socio-economic inequality in the U.S. and similar "Occupy movements" in many parts of the globe, in which youth participated in droves, and winning the support of people across generations.

The worrying trend of a growing NEET category of youth in many countries included the U.S., where 15.6 percent of the youth were in this classification in 2010. The ILO report throws further light on the phenomenon stating that, "In the developed world, NEETs tend to have a low education level, a low household income or an immigrant background. In developing economies, on the other hand, NEETs tend to be less poor than young people who have jobs, as employment is often poverty-driven and many young men have no alternative but to work." So, what are the governments doing to alleviate the situation?

The ILO report makes a mention of the recent effort by the U.S. administration to join hands with business leaders and communities "to provide summer jobs to hundreds of thousands of 'disconnected' and low income youth to help them gain work experience, skills and contacts." The report also notes that many other countries "offer incentives, such as tax relief, to encourage companies to recruit and train young people and where possible, create additional jobs."

A country which cannot be ignored on the topic of youth is India, where half of the total 1.2 billion people are aged below 25. Officially, youth (aged 15-24) unemployment rate is over 10 percent, but it is much more than that in reality. Unemployment is seen as a main reason for the youth in remote areas of the country to pledge their allegiance towards the leftwing extremist Naxal movement. In addition, the current slowdown in India's GDP growth due to the Government's policy paralysis has led to a complicated situation.

According to the 'Economic Survey 2011-12' of the Indian Government, "In 2020, the average Indian will be only 29 years old. Comparable figures for China and the U.S. are 37, 45 for West Europe, and 48 for Japan." This sort of 'demographic dividend' is at once a great opportunity and a great challenge, as the Survey observes. "It will benefit India only if our population is healthy, educated, and appropriately skilled," the Survey warns, adding that, "Therefore, greater focus on human and inclusive development is necessary to best utilize the demographic dividend." With this philosophy in mind, the Government set up the National Skill Development Corporation (NSDC), a Public Private Partnership initiative.

The target given to NSDC is to help in meeting at least 30 percent of the massive target of training 500 million people by 2022, mainly in the unorganized sector. This means NSDC alone has to train around 150 million people in10 years, while the rest of the work will be done by other departments such as labor and micro, small and medium enterprises (MSME). NSDC's role is to be "a catalyst in skill development by providing funding to enterprises, companies and organizations that provide skill training." An official involved in the implementation of the program said on condition of anonymity that the challenge is to create an ecosystem of proficient trainers, quality curricula, adequate training infrastructure, sectoral skill councils, technology platforms, placement cells and an even geographic dispersion of such facilities and skill pool.

Principally, of course, there is the challenge of reforming the entire education system (primary, secondary and higher education) in the country. Due to its poor quality, the system not only results in many students dropping out but also churns out a large number of unemployable candidates (read those without any analytical or creative skills and leadership qualities) even among those who manage to graduate.

Worried by the acceleration in the spread of the Naxal movement, the authorities, meanwhile, have begun work on skill-development initiatives combined with placement in firms, specially targeting several Naxal-hit districts. According to the Economic Survey, the Government has also sanctioned 329 Rural Self Employment Training Institute (RSETI), of which funds have been released to 264. The goal is to set up one RSETI in every district in the country for “skill development training of rural below poverty line (BPL) youth to enable them to undertake micro-enterprise and wage employment. The Survey found that “during 2010-11 and 2011-12 (till November 2011), approximately 183,765 rural youth (including 137,147 BPL youth) were trained in 264 RSETIs functioning in the country.”

In China too, the situation is depressing with youth unemployment is estimated to be over 20 percent, despite official data suggesting it is less than half of that.

By all accounts, the problem of youth unemployment is a ticking time bomb scenario, making one wonder if being young is really an advantage and whether such a large group of disgruntled youth will hold the key to the future of nations. Most recently, realising the gravity of the situation, leading international mainstream media houses such as the BBC have invited the unemployed/under-employed 16-24 year olds across the world to share their stories of the impact of staying unemployed/ under-employed on their lives and their job search efforts.

These developments become all the more significant as in June this year, the United Nations University International Human Dimensions Programme on Global Environmental Change and the United Nations Environment Programme released an ‘Inclusive Wealth Report 2012’. The report attempts to assess the ‘real wealth’ of every nation on recognizing that “conventional indicators such as Gross Domestic Product or the Human Development Index are failing to capture the full wealth of a country.” The proposed Inclusive Wealth Index includes a nation’s nature-based assets (such as forests and minerals, fossil fuels and land); ‘produced capital’ (such as roads and other infrastructure, factories and machinery, buildings etc.); and importantly human capital (education level, creativity, knowledge, skills). As ‘natural capital’ is impermanent and is exhaustible, this new method of measurement will put the spotlight on the ‘produced capital’ and more importantly ‘human capital’, which is where a workforce comprising skilled, knowledgeable and creative youth will assume predominance over everything else. In the future, it will be the nature of the ‘human capital’ that will be the deciding factor in the ranking of nations on the basis of their real wealth. This means a high level of youth unemployment will not only pull down the productivity of a nation, but also vastly diminish its standing amongst the comity of nations.

The solutions to the youth unemployment problem are oft-repeated in many a forum: prioritizing youth-centric policies, structuring continuous skill development programs, developing curricula in touch with the latest needs of the industry, bringing out nationally and internationally accepted skill certification systems, matching skill sets of individuals with the relevant jobs, granting fiscal incentives to the industry for skilling and employing the youth, and promoting entrepreneurial skills amongst youth.

Does the world have enough financial resources to uplift the youth out of this pathetic situation? Of course it has, especially when James Henry, a former chief economist at the global consultancy firm McKinsey, in a recent report for the Tax Justice Network, claims that the world’s ultra-rich has hidden anywhere between $21-32 trillion in secret tax havens.

The question now is whether there is the political and corporate will and vision to save an entire generation from being lost.

Lawyer-turned-journalist Arun S. Nair specializes in all aspects of international trade in goods and services as well as investment and finance.

This article was originally published in the Diplomatic Courier's September/October edition.

Editors note: This article has been updated to include a portion that was inadvertently omitted.

The views presented in this article are the author’s own and do not necessarily represent the views of any other organization.