Locked Out: How Job Protection and Housing Policy Impact Young Adults
"A new study reveals the surprising link between strict rental regulations, job security, and youth unemployment, offering insights into Europe's economic challenges."
Young adults in Europe face a tough economic landscape marked by high unemployment, unstable job prospects, and delayed independence. It's tempting to point fingers at labor and housing market policies, but the full picture is more complex. A recent study sheds light on the intricate relationship between job protection, housing regulations, and the challenges faced by young people entering the workforce.
Conventional wisdom suggests that loosening employment protection legislation (EPL) and housing market regulation (HMR) would boost employment and mobility. EPL is often seen as a barrier to entry, limiting vacancies and access to long-term positions. HMR, on the other hand, is accused of shrinking the rental market, hindering workers' ability to move for better opportunities. However, the youth often resist reforms aimed at weakening job security. Why?
The study suggests a surprising reason: in countries with strict rental regulations, job protection acts as a second-best solution, signaling a worker's reliability to landlords. This article explores this dynamic, revealing how seemingly unrelated policies can have unintended consequences on the lives of young adults.
Youth unemployment outruns adult rates worldwide
Youth unemployment is consistently higher than adult unemployment around the world, with the European Commission reporting higher youth rates than adult rates throughout 2014-2024. The gap is starkest where the transition from education into work breaks down: South Africa's data shows the youth transition rate into employment was just 4.7% in 2022, up from 3.5% in 2021. Global trackers now compile comparable figures on the youth unemployment rate by gender, the countries with the lowest rates, and forecasts of the number of young unemployed people through 2027. Dedicated national statistics, such as those maintained by the UK Parliament's research service, treat youth unemployment as a policy problem distinct from general joblessness.
Unemployment benefits and the limits of the safety net
The standard response to joblessness is formal unemployment insurance, as administered by states such as California and Pennsylvania, built around eligibility requirements, benefit amounts and durations, and application procedures. Such programs assume recent work histories and a functioning social-insurance system, assumptions that collapse where youth joblessness is structural. In South Africa, the jobless rate worsened to 33.6% while the youth unemployment rate rose 1.5 percentage points to 47.4% in the second quarter, with 5 million people aged 15 to 34 unemployed. At that scale, commentators frame the problem not as processing claims but as reassuring a desperate cohort that the system can ever deliver a job.
From measurement to endemic diagnosis
The foundational milestone is the unemployment rate itself, the number of unemployed as a percentage of the labour force, which has long been the standard measure of joblessness. Scholarship has since built on that metric to treat youth unemployment as a distinct field: Global Youth Unemployment: History, Governance and Policy offers a statistical examination of its incidence, distribution, impacts and causes, and develops the concept of 'Endemic Youth Unemployment' (EYU) through the lenses of social policy, social justice and globalisation. Analysts also point to the political dimension of the history, noting that the confluence of youth abundance, unemployment and political inconsistency can generate youth mobilization, yet such outbreaks have been uneven across countries such as India, Sri Lanka and Bangladesh. Together these milestones trace a shift from counting the jobless to diagnosing a systemic and endemic problem.
The Unexpected Link: Job Security as a Signal
Imagine a scenario where landlords need to be extra cautious about who they rent to. Strict housing market regulations make it difficult to evict tenants, meaning landlords face a significant risk if a tenant defaults on rent. In this environment, landlords need a way to assess an applicant's reliability. That’s where job protection comes in. Having a stable, protected job becomes a signal of trustworthiness.
- HMR Impact: Strict rental rules make landlords risk-averse.
- Job Protection as Signal: Stable jobs signal reliability to landlords.
- Youth Support: Young workers favor job security for rental access.
- Policy Paradox: Loosening job protection could hurt rental prospects.
Global youth unemployment rises as AI reshapes hiring
Recent UN reporting shows global youth unemployment rose last year, with some of the steepest increases seen in high-income countries as artificial intelligence begins to change the jobs market. Regional data underscores the trend: in Northern America, youth unemployment rose from 8.3% in 2023 to 9.8% in 2025, while Northern, Southern and Western Europe held at 15% even as 20 of 29 countries reported weaker employment prospects for young people. The UK reached 16.1% among those aged 16 to 24. Yet surveys of young people who are not in employment, education or training found that 84% said they wanted a job or training, pointing to frustrated demand for work rather than lack of aspiration.
Cyclical roots, policy failures and political fallout
A key counter-argument is that youth unemployment is not purely structural: it exhibits pronounced cyclical sensitivity, surging during economic downturns while persisting at elevated levels even in recoveries because of structural frictions. The ILO attributes the 2025 rise in global youth unemployment to weaker economic growth, geopolitical tensions and sluggish job creation, warning that AI could add to mounting labour-market pressures. When those failures compound, the consequences spill into politics: in Nepal, tens of thousands of Gen Z activists took to the streets last year over skyrocketing youth unemployment, and the protest ended with the prime minister's resignation. The episode illustrates how sustained failure to address youth joblessness can destabilise governments rather than merely move statistics.
Why cross-country comparisons mislead
Headline comparisons often mislead: in the France-versus-USA case, the ratio of unemployed to population is nearly identical at 8.6% for France and 8.3% for the USA, and France's apparently high youth unemployment largely reflects that far more young people remain in education, with only 41.4% of young males working in France compared with 70.2% in America. Researchers instead favour the ratio of youth to adult unemployment rates, which more accurately reflects the relative problem facing young people. Eurostat-based tools enable exactly that comparison, contrasting youth unemployment (under 25) with total unemployment across EU/EEA countries to highlight the youth gap. The gap has been widening: graduate youth unemployment has risen relative to the working-age population since well before the spread of AI tools, and young people remain more vulnerable to a slowing job market and changing skills needs.
Rethinking the Solution
The study suggests that reforms should focus on the housing market. By reducing the burden on landlords and making it easier to manage rental properties, policymakers can decrease the need for job protection as a screening mechanism. This could involve streamlining eviction processes, offering insurance against rent default, or providing incentives for landlords to rent to younger, less-established workers. Ultimately, creating a more flexible and accessible rental market can help young adults achieve economic independence without sacrificing job security.
Growth alone will not close the youth gap
Expert commentary converges on a clear message: youth unemployment in the EU is higher than overall unemployment and high by international standards, and growth alone will not solve it. Individual countries illustrate the scale, with more than 40% of young Italians out of work, an all-time high, while structural shocks elsewhere erase jobs wholesale, with South African employment falling by 2.2 million relative to the first quarter of 2020. The EU has earmarked €6 billion to put young people back to work against a youth unemployment rate around 23%, twice the level of the older population, but experts say cash is not enough: more political will is needed to ensure national programmes are ambitious and deliver tangible results.
67 million unemployed and rising
The projections point to sustained pressure: the global youth unemployment rate rose to 12.4% in 2025, accounting for 67 million unemployed people aged 15 to 24, while the share of young people not in employment, education or training increased to 20%, affecting 257 million people. Researchers studying the economics of youth unemployment stress its real consequences for young people's future prospects and argue that policy recommendations must target the underlying economic factors. That research agenda aims to reduce the negative impacts of early joblessness rather than simply waiting for growth to arrive. The numbers make clear why this frontier matters: a fifth of the world's young people are now outside employment, education and training.
Official rates that hide deeper trouble
The challenge now spans rich and poor economies alike. In Northern America, youth unemployment rose sharply, from 8.3% in 2023 to 9.8% in 2025, as young people in higher-income economies face a harder road to decent work. Yet low official rates can be just as deceptive as high ones: Nigeria's official youth unemployment rate stood at 5.3% in 2025 according to World Bank ILO modelled estimates, far below global averages, a figure that masks deeper structural challenges. The contrast highlights a systemic problem: national statistics and international benchmarks do not always capture the realities young workers actually face on the ground.
The human cost behind the statistics
Behind the numbers are consequences that reach into the future: researchers describe youth unemployment as a growing global threat that affects both today's and tomorrow's economies, and therefore a problem that must be battled globally rather than treated as a local or developing-country concern. Scholars have mapped the extent, causes and consequences of the problem, and are now testing remedies on the ground, with a Rwandan study, for example, comparing on-the-job training against cash handouts to determine which better improved youth job prospects. Youth unemployment was already a global concern before COVID-19, and the pandemic has threatened to turn it into a crisis as millions worldwide lost their jobs in the economic fallout. For policymakers, the human element is decisive: because youth unemployment affects both the present and the future, it is treated as a priority.