Unemployment ranks as 30-somethings’ primary fear

When studies on the young are published, the blatantly ironic tone of the newspaper titles – «our young are insecure; they want a public service job; they want to make money; they ’embrace’ the family» – is enough to rile someone like George. «It’s all very well for them to judge; at my age though they weren’t up to their necks in debt,» he says. George is 29 years old. He studied at the Athens University of Economics and Business and then left to continue with postgraduate studies abroad. He has been back in Greece for three years and works for a multinational company earning just 800 euros a month. Two years ago, he decided to rent his own place (even though it is nice to return home to some hot food after work) and also took out a loan to buy a small motorbike so as to get about more easily. He now owes 5,000 euros to banks and credit card companies. Study loans He is not the only one. As a top Eurobank executive told us, «there has been a dramatic rise in borrowing by the young over the last few years.» Study loans, which for years were dormant (used only to pay for studies abroad), have suddenly become very popular. «Most of the time, they are used to meet other needs, even those of the parents. Very often, the parents themselves are blacklisted and use the child to get the loan with the result that everyone ends up in debt. And the child, the family’s last bastion, falls,» he said. The banks themselves have recently turned toward the young, offering loans on special terms. «This might be a good thing for a young person who has support, but for others it could be disastrous. If something goes wrong, it is no joking matter for the bank and could leave the debtor branded for life. Even if the debts are settled and this is registered in the system, it is up to the bank’s discretion to trust that person again. There are many who were unable to start their own businesses because at some time they did not settle a debt of 200 euros. Someone could also be penalized for not paying off the installments on time,» he said. Credit cards are another trap for young people; many have to borrow to pay off massive debts as a result of not making payments on time. Very few can manage without loans and credit cards. Greece is now on a par with the traditionally more expensive North European markets and yet ranks among the lowest wage-earners in the EU, a difference of almost 10,000 euros with Northern European salaries. In 2004, the annual gross salary for a secretary in Greece – a job traditionally done by young women – was 15,759 euros (about 1,125 euros a month). For the same post in Spain, employers pay 21,034 euros annually, that is 33.47 percent more than in Greece. As a result of soaring prices, a Greek person’s purchasing power is very low (from 1995 to 2001, it increased by only 1 percent). Not surprisingly, in all the studies conducted, the No. 1 fear of the young is unemployment. Eurostat places Greece first in the eurozone for unemployment among the under 25s (25 percent), while the figure for the 25-29 age group is also very high (16 percent). An important contributing factor (which is also true for all EU countries) is the thirst for knowledge among the young today who often don’t start working until 35 in order to enrich their CVs with degrees and diplomas. Is it possible to feel secure under such circumstances? The research director of the Foundation for Economic and Industrial Research (IOBE) and professor at Panteion University, Theodosis Palaskas, told us: «The young today have to acquire more knowledge than previous generations, and this knowledge has to be constantly updated due to rapid developments in all areas. They have to do postgraduate studies, master’s degrees and doctorates; they have to invest in themselves if they want to increase their chances of getting a job. The problem is that they do not know whether this investment will actually bear fruit.» Taxation is another burden for the young in Greece. «A burden that is not matched by services offered by the state. Indeed the young have to run up further expenses for health and education in the private sector, such as courses at cramming schools,» Palaskas added. In fact, the most heavily taxed group in Greece at the moment consists of single 30-year-olds. «Even family benefits are minimal. The marriage benefit amounts to 18 euros, the child benefit 11 euros. As it is, a tin of baby formula costs 16 euros and only lasts 15 days.» At least the institution of the family is still strong in Greece and supports young people for a long period of time. According to recent research for the whole of Greece conducted by Athens University, 68 percent of under-29s live with their parents. Even a fairly large number who are married (30 percent) also continue to live in the parental home. What does the future hold? With the passage of time, the young will have to shoulder heavier burdens as a result of the aging population and the rising number of pensioners to support. The percentage of pensioners now dependent on younger workers is already 30 percent in Greece (one of the highest rates in the EU). An IOBE study predicts this figure will have risen to 61.6 percent by 2050.