Τετάρτη, 30 Οκτωβρίου 2013

Social Economy and Youth Unemployment: The Greek Case - Peer review Croatia 2013


Peer Review on Social Economy,
Comments paper: Greece Croatia 2013,
 (Zagreb, 29-30 October 2013)


Social Economy: The Greek Case


Konstantinos Geormas
Head of Social Economy Registry, 

Styliani Graikioti
Official, Social Economy Registry

Hellenic Ministry of Labour,
Social Security  and Welfare

Introduction

Greece has been severely hit from the current crisis. The need for fiscal consolidation has had significant impacts both to the economy and the social situation. The GDP contracted by 6,4% in 2012 and is expected to contract by 4% the current year. Unemployment, has risen sharply and employment rate has fallen to 55,3% in 2012. Recently, Greece has shown some positive signs regarding fiscal consolidation and leading conjunctural and financial market indicators are showing a tendency for stabilization.
The historical high level of unemployment, long-term unemployment and youth unemployment (up to 29 years) constitute key factors for severe poverty and social exclusion. Along with that the number of households with very low work intensity has increased dramatically, homelessness is on rise during the last years and child poverty remains an important issue. In that context the main challenges in employment as well as the social protection and social inclusion field for Greece in 2013 are to speed up employment policies and to limit the social impact of the crisis and of the fiscal consolidation measureς through the improvement and effectiveness of social transfers.


Unemployment
The unemployment rate in Greece exhibits strong increase since the last quarter of  2008 to date. More specifically the unemployment rate of the age cohort > 15 years, based on data from the Hellenic Statistical Authority, has climbed to 27,1% in the second quarter of 2013 compared to 23,6% in the second quarter of 2012.The impact of the recession is stronger for people with low education level (43,5% no school at all), whereas the unemployment rate for women is higher than the relevant of men.
The employment rate (cohort ages 20-64) exhibited significant decline since 2008 and reached 55.3% in 2012, compared to 59.9% in 2011 and 66.5% in 2008[1]. It is important to notice that unemployment has affected the «breadwinners», that is men at the age of 35-55. This phenomenon is related with the implications that crisis has had on economic activity.

Unemployment by sex and age cohort
Second quarter








2012
2013
Age
Men
Women
Total
Men
Women
Total
Total
20,8
27,3
23,6
24,1
31,1
27,1
15-24
46,8
62,1
53,9
54,2
65,1
59,0
25-29
35,0
38,9
36,8
41,7
47,6
44,4
30-44
19,3
26,1
22,3
21,8
30,3
25,5
45-64
14,8
17,9
16,0
17,6
20,7
18,9
65+
3,6
5,6
4,2
13,5
5,5
11,3

Youth unemployment

The highest unemployment rate in Greece is observed among young people. It has to be noticed that youth unemployment was among the highest in Europe even before the crisis started. The unemployment rate for the age cohort 15-24 was 53,9% in the second quarter of 2012, and 59,0% in 2013. High rates of unemployment are also observed among young people aged 25-29 years and those aged 30-34 years.
Moreover, the situation for young women is worse than the relevant for young men. The unemployment rate for women in the age cohort 15-24 was 62.1% in the second quarter of 2012 (46.8% for men) compared to 65,1% at the second quarter of 2013 (54.2% for men).

A main characteristic of youth employment in Greece is the prolonged transition period from education to the labor market. Based on Hellenic Statistic Authority data, more than half (>50%) of young people up to the age of 22 years, have no working experience at all. Even up to the age of 25 years, 20% of people surveyed have not gained any work experience.


Social Entrepreneurship[2]

There a number of issues emerging regarding the development of social economy in Greece.

a) Among civil society there are a series of initiatives. It seems that the crisis in Greece has opened up the need for new ways in order to address unemployment issues as well as local development. It suffices to note that during the last month alone, have been registered 80 social cooperative enterprises. In addition to this, there have taken place a series of forums and conferences. Recently, a forum organized by the Municipality of Athens has gathered at least 400 people.  
b) As it was mentioned before there are a number of organizations that have taken initiatives regarding the promotion of social economy. The Municipality of Athens, as well as the Municipality of Thessaloniki are among them. The General Confederation of Greek Agricultural Associations has organized a series of events regarding social enterprises especially for women farmers. The Technical Chamber of Greece set up a number of workshops which resulted in a number of «virtual» social enterprises by young engineers. Universities has taken initiatives regarding social entrepreneurship in the context of  their Employment and Career Structures.
A significant development regarding the social economy sector is the close cooperation of Social Cooperative Enterprises with municipalities in order for the first to provide strongly needed services to the latter in the area of social care, culture and the environment.
c) There is a tendency for foundations to discuss initiatives regarding social entrepreneurship. We mention here the recent international conference organized by the Stavros Niarchos Foundation, which devoted a specialized table regarding the relation between philanthropy and social entrepreneurship.
d) In the recent Memorandum of Understanding there is a clear reference to the development of social economy as a measure in order to enhance employability.


2. Brief note of recent policy initiatives on social entrepreneurship on the institutional level
    
     The Ministry of  Labour, Social Security and Welfare in cooperation with the European Commission, in the framework of the Technical Steering Committee for social economy (consisting of international and Greek experts and Greek public officers) that had the mandate to formulate an action plan for the creation of a supportive eco-system for social economy in Greece have resulted in a Strategy Plan for the Development of Social Entrepreneurship. 
    
     The strategic vision of the Plan for the Development of Social Entrepreneurship is to generate a significant impact on the economical development at local, regional and national level ensuring at the same time the social cohesion. The overall objective of the Strategy Plan is the activation of an ecosystem that is going to help the development of Social Enterprises.

     At present the observed obstacles in Greek reality are the lack of appropriate and accessible support services provided to Social Enterprises, the lack of specialized programs of subsidizing the start- up stage of Social Enterprises, the adverse financial environment for the development of financial instruments, various complex administrative issues relevant to the development of Social Entrepreneurship and small visibility of the new legal entity of Social Enterprises as well as of the value of social entrepreneurship.

     The strategic vision of the plan is intended to be accomplished through an integrated approach and certain priorities targeting at:

·       The creation of a supporting system for the development of Social Enterprises.
·       The provision of the necessary start-up capital for Social Enterprises
·       The provision of financial aid in the short and long run of the Social Enterprises operation.
·       The abolition of any administrative and legal obstacles as well as the  creation of a favorable environment for the development of Social Enterprises, by creating an integrated legal framework for public procurements for Social Enterprises.
·       The promotion of mutual learning and capacity building of social entrepreneurs, national and regional administrations.
·       The implementation of a campaign informing the society on Social Entrepreneurship  as well as the creation of information platforms with the aim to sensitize the community on the issue of Social Entrepreneurship with the ultimate purpose to generate local pacts between social enterprises and the private and  public market.
·       The implementation of transnational actions, using in the best way the European and International expertise on the development of Social Entrepreneurship. 
·       The creation of an observatory aiming at comprehensively mapping  Social enterprises in Greece in order to identify good practices and collect reliable data on social entrepreneurship.


The Strategy Plan for the Development of Social Entrepreneurship is comprised by three action axes as follows:

Action Axis 1. Support for the sector of Social Economy.
Action 1: Central Support Mechanism.
Action 2: Observatory for Social Economy and Social Entrepreneurship.
Action 3: Regional Support Mechanisms.
Action 4: Actions of the Special Service for Social Inclusion and Social Economy (ΕΥΚΕΚΟ), as the coordination public body for the development of for Social Economy.

Action Axis 2. Financial Support for Social Cooperative Enterprises (koinSEp).
Action 5: Support for the pre start-up of KoinSEp.
Action 6: Vouchers for the support of KoinSEp with “incubator” type services (start-up support).
Action 7:  Vocational training for KoinSEp members and employees.
Action 8: Grants for the purchase of cooperative shares by KoinSEp employees.
Action 9: Support grants to KoinSEp for the creation of new employment positions.

Action Axis 3. Financial instruments for the support of KoinSEp.
Action 10: Complementary refundable grants.
Action 11: Preparatory actions for the creation of a Micro Finance Institution.
The budget of the implementation of the aforementioned actions amounts to 60.000.000 and is co-financed  by ESF[3].

3. Data from the Social Economy Registry

At present, there are 274 Social Cooperative Enterprises (KoiNSEP) in the registry, and most of which are of collective and productive purpose. The KoinSEp have 2.627 members.

Their distribution among the three main categories is: 

Category
Number of KoinSEp
Social Integration KoinSEp
6
Social care KoinSEp
52
KoinSEp with  a collective and productive purpose
216


The number of the 216  KoinSEp of a collective and productive purpose is unevenly distributed in the Greek territory. Namely, 87 KoinSEp  are in the region of Attica (the wider area close to Athens), 28 are in the region of  Central Macedonia, 23 in the  region of Peloponnese,19 in the island region of South Aegean, 17 in the region of Thessaly, 13 in the region     of  Eastern Macedonia, 7 in the region of Crete, 6 in the islands of Northern Aegean, 6 in the region of Western Greece, 4 Central  Greece, 3 in the region Epirus, 2 in Ionian islands and 2 in Western Macedonia[4].

The greatest number of Social Cooperative Enterprises is observed in the third category of KoinSEp, 216  out of  274, showing that social entrepreneurship doesn’t consist the  hope of vulnerable groups to find the way out of  unemployment but mainly the hope of the general unemployed population, in this current  period of the Greek economic crisis. It is also of interest that Social Integration KoinSEp are only 6. We believe that this is due to the fact that such Social Enterprises need more effort and expertise in order to set them up. It is worth mentioned that in such cooperatives at least 40% of their employees have to belong to a vulnerable group.
According to our experience the people that come to register fall into the 29-50 age category. Second category are the young people. This fact is closely related with the corresponding unemployment percentages.


3. Brief summary of policy initiatives on youth employment and entrepreneurship

Combating the high youth unemployment levels constitutes a main priority for European Union institutions and Member States. The need to tackle the problem of high youth unemployment in Greece requires immediate coordinated actions and initiatives, capitalizing on young people's creativity and innovative ideas. A cohesive operational Action Plan has been elaborated and has been implemented to strengthen youth employment and entrepreneurship.
The basic categories of interventions regard the reinforcement of apprenticeship and traineeship systems, the establishment of systematic transition programs from education to employment, in order to support the acquisition of first working experience and to promote entrepreneurship.
Counseling and mentoring services are the basic tools for supporting young people in their transition to the working or business environment.

The main 6 priority axes of the Action plan are the following:

1.    Creating jobs for young people according to their qualifications.
2.    Strengthening Vocational Education training and education systems with emphasis on the combination of training and work experience along with further investment in work placements. 
3.    Establishing systematic programs for the transition from education to work (school-to-work programs) to support the acquisition of the first work experience (combined with mentoring, counseling, training and employment) tailored to the specific profile and needs of young people.
4.    Increasing support of counseling and guidance with emphasis on young unemployed. Strengthening the school career guidance and counseling for entrepreneurship in higher education.
5.    Strengthening youth entrepreneurship, focus on new / innovative products, services and entrepreneurship fields.
6.    Investing in measures aimed at reducing school dropout.

Under the proposed Action Plan a cumulative budget of 608.326.537 € has been re-allocated (stemming from OP revisions) and will be channeled to a total of 349.499 beneficiaries in the age cohort 18-35.

The implementation of most of the actions of the Action plan for young people has already started.

In short, we could mention the implementation of some indicative actions such as:

·     The voucher for the entrance of unemployed young people up to the age of  29 to the labor market, including an integrated raft of interventions by granting a voucher for: training in combination with guidance / educational mentoring, in-service training / Working experience of five (5) months, grant to businesses that will convert in-service training to a work contract, covering also the employer's contributions for a year. The budget of the program is 174.900.000 € while the beneficiaries amount to 45.000 young people.
·     Of similar nature is the voucher for the entrance of young people in enterprises in the tourism sector.

4. Programs for the employment of disadvantaged groups that are currently implemented in Greece are as follows:

A.  Local Actions for the social inclusion of vulnerable groups
The aim of the Local Actions co-funded by ESF (with a budget of 140.000.000 €)  is  the mobilization of local public and private bodies towards the job placement of unemployed vulnerable groups.
 The Actions implemented by Development Partnerships have an integrated character including various activities such as vocational training, on the job training, business plan creation, counseling on legal and other issues, with the aim to give the beneficiaries the chance to create a  business, to acquire the prerequisites to be subsidized by different programs, to develop skills in order to cover the demanded needs of the enterprises. The social enterprises expected to be established as a result of the intervention will be approximately 600.

B.     Public Works Program
The objectives of the specific program is the financial support of families that have no working members and simultaneously the conservation of the contact of the family members with the labor market as well as the satisfaction of societal needs and the improvement of civil services.
The budget of the program is 216.000.000 € (co financed by ESF and  ERDF) and targets 50.000 unemployed people who are apart from the members of families with no working members, young unemployed aged 18-29,  long term unemployed and unemployed university graduates. The aforementioned beneficiaries are placed in jobs in the public services (schools, Local Authority Bodies, Courts e.t.c)  for 5 months.

C. Programs ran by ΟΑED (MANPOWER EMPLOYMENT ORGANISATION)

a. Grants of  28.000 € are given to  new entrepreneurs (having started their business activity from 01/09/20109 and on) who are disabled, ex offenders and ex drug users. The grants are given over a period of three years. The total budget of the program is 22.400.000 , with 800 beneficiaries.
b. Grants, with  a ceiling of  2.500 , are given to new entrepreneurs with the aim to improve the working conditions of disabled people. The budget of the program is 125.000 with 50 beneficiaries-disabled people.
c. A three–year program, funded by the state budget, addressing  primarily to employers of small enterprises with up to 50 employees. The program  is refunding all social insurance payments for employing  unemployed disadvantaged people (disabled people,  delinquent teenagers, ex offenders, ex drug users). The employers have the obligation to further employ the disadvantaged employees for a period of 12 months after the three-year grant. The total budget of the program is 27.500.000 with 2.300 beneficiaries.
d. Grant programme for enterprises to recruit unemployed graduates from Higher Educational Institutes, aiming to create full employment jobs in private enterprises and private sector employers in general, through the recruitment of unemployed persons up to the age of 35 who are  holders of a first degree, post-graduate title or a PhD of Greek AEI/TEI or an equivalent title from a Faculty abroad. The budget of the program, funded by ESF,  is  37.500.000  € and the beneficiaries of the program will be 2.500 unemployed young people.

The National network of immediate social interventions with the objective to offer integrated services to homeless people who find themselves in poverty, or are threatened by poverty. Said services will be offered through the creation of at least 200 'Social Structures of Immediate Poverty Relief'. A two-year financing is provided for their operation and staffing. Such structures will be staffed by young unemployed, up to the age of 30 years. The beneficiaries of the program are unemployed young persons who shall staff new or/and existing social structures while homeless and persons in poverty state or running the risk of poverty shall enjoy the services of these social structures. The budget of the program, funded by ESF, amounts to 40.000.000 € and the number of the beneficiaries is 1.200 unemployed young people.
D. Integrated interventions for the support of Female entrepreneurship
The program includes two sub actions: a) Integrated intervention for the support of woman entrepreneurship for women aged 18-35 and b) Integrated intervention for the support of woman entrepreneurship for women aged 36-64. The programme targets women who are unemployed, who have been dismissed during the last three years and have been looking for a job, who have shut down their own business during the last three years, who are threatened by unemployment, who have a  self insurance with an income below the lowest income poverty limit as this is defined by the Hellenic Statistics Organization. 
Grants, with a ceiling of 32.000 €, are given in order to cover business operational expenses, employer insurance payments, counselor’s   services to create as well as monitor the business plan, coaching and mentoring services, training expenses of the entrepreneur as well as training expenses of the newly employed in the enterprise, wage expenses for the newly employed people in the enterprise. 
The total budget of the program co financed by ESF 77.000.000 Euros through the National Contingency Reserve.

Strengthening youth entrepreneurship, with the aim to boost business initiatives placing emphasis on high added value goods and services, integrating innovative ideas and environmentally friendly productive processes. The program focuses mainly on the sectors of economy that can possibly turn Greek entrepreneurship towards a substantial extrovert growth and it includes grants to the unemployed to set up a new business. The beneficiaries are  young people aged 18 to 35 years wishing to set up their own business. The budget of the program, funded by ERDF, amounts to 60.000.000 € and the number of the beneficiaries is 1.600 unemployed young people.



5 Issues for the debate

In many ways, the Greek experience is similar to the Croatian one. Regarding both employment rates as well unemployment the numbers indicate a striking similarity. There are also similar approaches regarding the development of social entrepreneurship.
The situation is rather complex for in a resource constrained environment, there is the need to increase expenses in policies that promote employment as well as social cohesion. It is in this environment that European Funds play a crucial role for the promotion of employment and social cohesion policies.
In Greece, there are a series of policies and programmes now underway regarding unemployment and social cohesion, but we need some time in order to see how labour market will respond to them. For the time being, programmes that are known as “social/public works” are the ones that seem to have immediate results.
It seems that on the civil society level, and in the labour market, the capacities in order to respond to the aforementioned programmes are lacking. This points up to the fact that there is a need a long term effort in order to build such capacities. Employment programmes, as well as programmes that deal with social entrepreneurship, need a multifaceted approach. That means that these programmes have to deal simultaneously with subsidies, training, counseling, and mentoring. There is the need for support structures on the local level. This because of the fact that there is a need to build step by step skills that promote employability as well as structures that support the inclusion into the labour market.
Despite the fact that there is an urgent need for immediate results, the design of such programmes has always to take into account a global perspective, an intergrated approach, that will promote not only individual capacities (employability) but capacities on the societal/labour market level. And this, besides the efforts of the central administration, can be achieved with the mobilization of all relevant stakeholders (local authorities, social partners, local civil society etc).  
















[1] Ministry of  Labor, Social Security and Welfare , Action Plan: Targeted interventions to enhance youth employment and entrepreneurship,  2012
[2] For a detailed presentation of developments on the Greek social economy sector please refer also to Peer Review on Social economy, Comments paper: Greece, France 2012, (Paris, 10-11 December 2012), Social Economy: The Greek Case, Dionyssis Balourdos (National Centre for Social Research), Konstantinos Geormas (Head of Social Economy Registry, Hellenic Minstry of Labour, Social Security and Welfare)

[3] Ministry of Labor, Social Security and Welfare, “Action Plan for the development of Social Entrepreneurship sector”, February 2013
[4] Source: Department for Social Economy Register, Directorate for Social Protection, Ministry of Labour, Social Security and Welfare.

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