people and planet

2
disproportionately affected, accounting for over onethird
of the unemployed globally (ILO, 2015b). Some
regions display considerable gender disparity, including
Latin America and the Caribbean, sub-Saharan Africa and,
in particular, Northern Africa and Western Asia, where
21% of women are unemployed – almost double the share
of men. Underemployment is also significant. In the
European Union, 10 million are underemployed, twothirds
of them women (Eurostat, 2015). Unemployment
figures exclude those who have stopped actively seeking
work, often because they cannot find employment or
have given up. In 2013, the number of these ‘discouraged
workers’ was estimated at 23 million globally (ILO, 2014).
Education can have a significant role in facilitating
employment, as reflected in lower unemployment rates
among the comparatively educated, particularly in richer
countries. However, in poorer countries this relationship
often breaks down, suggesting both that demand for
skilled labour is limited and that education systems
are not enabling students to acquire relevant skills
(ILO, 2015a; Sparreboom and Staneva, 2014).
In richer countries, low educational attainment has a
strong association with unemployment and inactivity.
In the OECD, only 55% of adults aged 25 to 64 with less
than an upper secondary education were employed
in 2013, compared with 73% of those with an upper
secondary or non-tertiary education and 83% with a
tertiary qualification (OECD, 2015c). 8 The corresponding
rates among those aged 15 to 29 who were not in
education were 49%, 73% and 83% (OECD, 2015b).
Evidence across 11 EU countries shows that the
probability of long-term unemployment decreases
with higher educational attainment (Garrouste et al.,
2010). In emerging economies such as South Africa
and Turkey, there are large differences in employment
rates by educational attainment. In South Africa, less
than 45% of the adult
population with less
than upper secondary
Evidence across 11
education were
EU countries shows employed in 2005,
compared to over 60%
that long-term
who completed upper
unemployment
secondary, and over
decreases with higher 80% with a tertiary
qualification (Quintini
educational attainment
and Martin, 2013). In
the United States, high
school and university completion significantly increases
the chance of unemployed workers finding work within a
year (Riddell and Song, 2011).
By contrast, unemployment in non-OECD countries is
often associated with higher levels of education. In Asia
and the Pacific, North Africa and Western Asia, and sub-
Saharan Africa the youth unemployment rate increases
with the level of education. Youth with tertiary education
in these regions are two to three times more likely to be
unemployed than youth with primary education or less
(ILO, 2015a). In several sub-Saharan African countries,
differences are especially large among young adults aged
25-34. In the United Republic of Tanzania, for example,
unemployment is almost negligible among those with
primary education or less, but almost 17% for those
with tertiary education (UCW, 2013). Such outcomes
are partly due to the more educated coming from
wealthier backgrounds and thus able to sustain periods
of unemployment, whereas employment is necessary for
survival among the poorer and less educated (UCW, 2013).
High unemployment rates among the relatively
educated – particularly among youth – also reflect low
education quality, weak skills acquisition and limited
labour demand. In Northern Africa and Western Asia,
where youth unemployment is pervasive, education
quality is low, as indicated by the fact that some 75% of
eighth grade students scored poorly on international
mathematics tests. Tertiary enrolment is also weighted
towards subjects with relatively low labour market
demand (particularly law, the humanities and business/
commerce). These factors may explain why almost
40% of firms in Northern Africa and Western Asia – the
highest share of any region – identified an inadequately
educated workforce as a major constraint to growth
(Gatti et al., 2013).
TVET is often promoted as a potential solution to youth
unemployment, facilitating school-to-work transition
by providing skills more relevant to the labour market.
However, the evidence is mixed: While some studies
indicate that vocational education increases youth
employment, the consistency of the finding in different
settings and over the life course varies (Hanushek et al.,
2011; OECD, 2015b).
There is a limit to the extent countries can educate
themselves out of unemployment. In poorer countries,
high unemployment rates among the educated likely
reflects limited demand for skilled labour, amplified by
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CHAPTER 2 | PROSPERITY: SUSTAINABLE AND INCLUSIVE ECONOMIES