NEET Youth in CEEC
Brief about:
Journal Article (2024)
Written by:
Investigates the macro-determinants influencing the Not Engaged in Employment, Education, or Training (NEET) youth in Central and Eastern European Countries (CEEC) using panel data analysis from 2013 to 2021.
In Central and Eastern European Countries, the NEET youth rate, which includes individuals aged 15 to 24 who are not in employment, education, or training, is a significant socio-economic issue. Countries like Bulgaria, Albania, and North Macedonia allocate 2% to 3% of their GDP to address the financial costs associated with NEETs. This demographic challenge is compounded by high unemployment and inactivity rates among young people, which pose serious economic and social costs. The NEET rate is distinct from the youth unemployment rate, as it encompasses both unemployment and inactivity, providing a broader picture of youth disengagement. The study focuses on the shared political and economic transitions in CEEC and the disconnection between educational systems and labor markets, contrasting with Continental Europe where school-to-work transitions are more integrated. The research aims to address gaps in understanding the macro-determinants of NEET status in CEEC, particularly the roles of labor market regulation and vocational education and training (VET) enrollment.
The study identifies several hypotheses: better socio-economic conditions (GDP, employment, HDI) reduce NEET rates; labor market regulation affects NEET employment dynamics; government education spending reduces NEET rates; and dropout rates and VET school development impact NEET growth. The research employs a panel data analysis method, using data from Eurostat, UNESCO, and the World Bank, to explore these hypotheses. The study’s findings are intended to inform policy measures that could decrease NEET rates by addressing socio-economic and institutional conditions at the country level.
Key findings
- Gross domestic product (GDP) per capita and labor market regulation significantly impact NEET rates in CEEC.Evidence
The panel analysis shows that GDP per capita has a coefficient of -0.59 (p<0.01), indicating a strong negative relationship with NEET rates. Labor market regulation also shows a significant negative effect with a coefficient of -0.40 (p<0.01).
What it meansThese findings suggest that economic prosperity and flexible labor market policies can reduce NEET rates, highlighting the importance of economic growth and labor market reforms in addressing youth disengagement.
- Early school leaving and unemployment rates positively affect NEET rates.Evidence
The study finds that early school leaving has a coefficient of 0.11 (p<0.01), and unemployment rates have a coefficient of 0.09 (p<0.05), both indicating positive relationships with NEET rates.
What it meansHigh dropout rates and unemployment contribute to increased NEET rates, emphasizing the need for educational retention strategies and job creation to mitigate youth disengagement.
- Vocational education and training (VET) enrollment negatively impacts NEET rates.Evidence
VET enrollment rate has a coefficient of -0.12 (p<0.05), showing a significant negative relationship with NEET rates.
What it meansStrengthening VET programs can effectively reduce NEET rates by aligning educational outcomes with labor market demands, offering a pathway for youth engagement.
- Human Development Index (HDI) correlates negatively with NEET rates.Evidence
The HDI shows a coefficient of -0.03 (p<0.01), indicating a significant negative relationship with NEET rates.
What it meansHigher human development levels are associated with lower NEET rates, suggesting that improvements in overall well-being can contribute to reducing youth disengagement.
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NEET Youth in CEEC
Cite this brief: Karma, Emiljan. 'NEET Youth in CEEC'. Acume. https://www.acume.org/r/neet-youth-in-ceec/
Brief created by: Professor Emiljan Karma | Year brief made: 2025
Original research:
- Karma, E., ‘NEET Youth in CEEC’ (pp. 1–18). –
Research brief:
Investigates the macro-determinants influencing the Not Engaged in Employment, Education, or Training (NEET) youth in Central and Eastern European Countries (CEEC) using panel data analysis from 2013 to 2021.
In Central and Eastern European Countries, the NEET youth rate, which includes individuals aged 15 to 24 who are not in employment, education, or training, is a significant socio-economic issue. Countries like Bulgaria, Albania, and North Macedonia allocate 2% to 3% of their GDP to address the financial costs associated with NEETs. This demographic challenge is compounded by high unemployment and inactivity rates among young people, which pose serious economic and social costs. The NEET rate is distinct from the youth unemployment rate, as it encompasses both unemployment and inactivity, providing a broader picture of youth disengagement. The study focuses on the shared political and economic transitions in CEEC and the disconnection between educational systems and labor markets, contrasting with Continental Europe where school-to-work transitions are more integrated. The research aims to address gaps in understanding the macro-determinants of NEET status in CEEC, particularly the roles of labor market regulation and vocational education and training (VET) enrollment.
The study identifies several hypotheses: better socio-economic conditions (GDP, employment, HDI) reduce NEET rates; labor market regulation affects NEET employment dynamics; government education spending reduces NEET rates; and dropout rates and VET school development impact NEET growth. The research employs a panel data analysis method, using data from Eurostat, UNESCO, and the World Bank, to explore these hypotheses. The study’s findings are intended to inform policy measures that could decrease NEET rates by addressing socio-economic and institutional conditions at the country level.
Findings:
Gross domestic product (GDP) per capita and labor market regulation significantly impact NEET rates in CEEC.
The panel analysis shows that GDP per capita has a coefficient of -0.59 (p<0.01), indicating a strong negative relationship with NEET rates. Labor market regulation also shows a significant negative effect with a coefficient of -0.40 (p<0.01).
These findings suggest that economic prosperity and flexible labor market policies can reduce NEET rates, highlighting the importance of economic growth and labor market reforms in addressing youth disengagement.
Early school leaving and unemployment rates positively affect NEET rates.
The study finds that early school leaving has a coefficient of 0.11 (p<0.01), and unemployment rates have a coefficient of 0.09 (p<0.05), both indicating positive relationships with NEET rates.
High dropout rates and unemployment contribute to increased NEET rates, emphasizing the need for educational retention strategies and job creation to mitigate youth disengagement.
Vocational education and training (VET) enrollment negatively impacts NEET rates.
VET enrollment rate has a coefficient of -0.12 (p<0.05), showing a significant negative relationship with NEET rates.
Strengthening VET programs can effectively reduce NEET rates by aligning educational outcomes with labor market demands, offering a pathway for youth engagement.
Human Development Index (HDI) correlates negatively with NEET rates.
The HDI shows a coefficient of -0.03 (p<0.01), indicating a significant negative relationship with NEET rates.
Higher human development levels are associated with lower NEET rates, suggesting that improvements in overall well-being can contribute to reducing youth disengagement.