Address by Mr. Guðbjartur Hannesson, Minister of Social Affairs, to the Annual Convention of the Nordic Youth Council, 29. oct. 2010.

Honoured guests, dear Nordic friends.

It is always a special occasion when the Nordic Youth Council convenes for its annual meeting. I expect that the participants have been looking forward to coming here because the agenda of the Council is quite serious, the issue of young people and the labour market under the shadow of unemployment. Our common objective is to strengthen and ensure the position of youth in the labour market.

We in the Nordic countries have many things in common as we base our heritage in many respects on similar experiences, and the history of our nations is intertwined way back for centuries. Our social structures are similar and our views on welfare issues are based on common ground although in practice there are many differences between our welfare states. The Nordic countries share a common trait of basing their economies on a strong labour market and a high rate of labour market participation by the general public.

In 1954, an agreement was concluded for a joint labour market for the Nordic countries and this is undoubtedly the most important step that has been taken in Nordic cooperation. Iceland did not become a full participant until 1982, although we enjoyed in practice the same rights as other Nordic citizens. With this agreement, the Nordic countries envisaged that they could assist each other in containing unemployment through labour market mobility depending on conditions in each country at each and every time. These expectations have been borne out by experience.

Today we have become participants in a much larger labour market in the European Economic Area and the European Union. Still, Nordic cooperation in labour market affairs remains strong and the flow of labour between the countries is considerable. Under the auspices of the Nordic Council, a determined effort is being made to facilitate the movement of people between the countries through information services such as „Hello Nordic countries“, a Nordic website with information on the social security systems of all the countries and a website with information on taxation. It is important that the Nordic nations stand together, cooperate with each other on current projects and jointly address urgent common problems.

At present, the high rate of unemployment is a major issue of concern, especially youth unemployment which has become a serious and growing problem.  However, it should be borne in mind that although the problem of young people in this respect has increased sharply with the economic recession it was already substantial for some nations before the recession began.

A thorough analysis of the problem and the state of these affairs in all the Nordic countries has been presented in a recent Nordic report that was prepared pursuant to the decision of the Nordic ministers of economic affairs and education.

One of the conclusions of the report is that the problems are alike amongst all the nations and it could therefore be suitable to apply common solutions. Youth unemployment is a serious affliction that can have grave consequences for society as a whole in the long term.  Many nations face considerable changes in the age structure of their population where large segments of people disappear from the labour market and a relatively smaller proportion of the total population must bear the burden of paying for the expenses of total society.

It has been shown that youth unemployment can have serious personal and long-term consequences. The danger is most for those who have completed a brief eduction, those who can not enter the labour market at the completion of their education or lose their job after a short while.

The social and psychological problems associated with unemployment are well known and the problems of the unemployed increase the longer they remain without a job. For these people, it can prove difficult to regain a foothold in the labour market, even if employment conditions improve and sufficient vacancies become available. Under these circumstances a serious shortage of labour can emerge at the same time as whole generations of people have been alienated from society and have been ruled out of play.

In Iceland, unemployment has for many years been virtually unknown. The nation is quite young and the share of people of working age is high. It appears that the ample supply of jobs has discouraged people from getting an education. Many have entered the labour market as soon as they completed their compulsory education and the percentage of people with relatively little education is rather high.

After the economic collapse, unemployment soared to previously unknown levels. It became immediately clear that the position of people with little education was more vulnerable than that of others. These are the people who lose their jobs first and who have the most difficulty in finding a new job.

Measures to counter unemployment and its adverse effects have been focused on young people. Much emphasis has been place upon facilitating their access to education and education-related occupational opportunities. New education avenues have been opened up for young people where an effort is being made to tailor eduation to individual needs and create a diversity whereby most people can find something to suit them. 

The fight against unemployment is not the task of one or a few institutions. If success is to be achieved, common cooperation is required. In this country, a call is being sent out to bring about a national effort to combat unemployment in the wake of the economid depression. Every effort is being made across ministries, where the education system and the social support system are working in tandem, the labour unions and employers have been summoned for cooperation along with the municipalities, volunteer organisations such as the Red Cross, and others.

The Nordic report I mentioned earlier is also an important contribution to the debate on measures to strengthen the position of young people in the labour market. Everywhere it is made clear that the position of those who have little or no education is the most difficult and the key to the solution appears to be to educate people out of the depression.

This is the task ahead. We must turn our defense into offense, turn unemployment to our advantage and use it to create opportunities for a better education in a range of areas. This is how we can pave the way for coming generations, create a strong economy and make us more qualified to face the challenges of the future.

I hope you enjoy your stay here in Iceland and that the convention will be enjoyable and useful for all.