Italy is home to many of the great symbols of Western political and economic dominance: The Coliseum, the Roman Forum, St. Peter’s Basilica, the Uffizi Gallery, and countless others. These relics of a once glorious past make it easy to lose sight of the current challenges that threaten to limit opportunities for an entire generation of Italians. Chief among these challenges is a worsening economy, which faces rising debt levels, negative growth, and rising levels of unemployment – particularly for those under the age of 35.
On April 29, Italy’s political leaders did what recently seemed impossible – they agreed on a new prime minister, Enrico Letta, who will lead a broad coalition government comprised of officials from both the Democratic Party (PD) and the People of Freedom (PDL) Party led by former Italian Prime Minister Silvio Berlusconi.
The success of this coalition government is yet to be determined, but a commitment to improving job prospects for the country’s youth would go a long way in restoring confidence that Italy’s political leaders are truly dedicated to helping the country emerge from its economic malaise.
The fact that Letta, who at 46 is exceedingly young by Italian political standards, has stated his intention to shift the government’s focus from austerity and deficits to jobs and growth bodes well for the 40% of Italy’s youth who are jobless. Indeed, during his first speech to Parliament Letta announced that he would give businesses tax incentives to hire young workers. If Italy is to regain its competitiveness and return to growth, this isn’t just good politics, it’s good policy. Italy’s new government appears to be taking this issue seriously, pledging to reduce youth unemployment to below 30% in the next few years.
If these millions of young men and women aren’t given the chance to establish their own careers soon, the consequences for Italy will be catastrophic. Talented, highly educated young people will abandon Italy for jobs overseas. This brain drain will inevitably have negative consequences for Italian innovation, entrepreneurship, and investment, all of which are key drivers of economic growth. Worse still, those who aren’t fortunate enough to find jobs will never be able to gain the experience and skills they need to help Italy reach its economic potential. They could become a permanent drag on Italian public resources as they struggle to gain financial independence, exacerbating what many are already calling a debt crisis in Italy.
While young people are always the segment of the population hardest hit by recessions, there comes a point where high unemployment rates in this demographic cease being an inevitable byproduct of hard economic times and begin to be a serious threat to future prosperity. Italy is at that point and must act decisively to get young people into the labor force and out of their parents’ homes.
An Italy focused on its young people is an Italy likely to emerge from the European recession stronger and better positioned to capitalize when economic conditions rebound. This is the job Italy’s new government faces, and it’s one they must succeed in.