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In focus: Greece

Going local: Crete

Contribution by Stavros Arnaoutakis,
Head of the Region of Crete

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The Region of Crete is a new institution of elected regional representatives that has become reality since January 2011. This is the result of the implementation of the so-called 'Kallikratis Plan', which has restructured Greek local government by abolishing the country’s 54 prefectures and 22 other broad administrative units, replacing them by 13 regional assemblies.

Our regional government aims at deepening local and regional democracy, while further unleashing and making appropriate use of our region's strengths and potential. Our intention is to continuously improve services provided to our citizens, promote transparency and accountability, and at the same time, successfully negotiate with the central government for funds for the benefit of our local societies.

During such a period of crisis for Greece, the Region of Crete has chosen to intensify its efforts to support and promote youth entrepreneurship and create sustainable jobs in new sectors such as technology and energy. Our priority is to promote innovation and make Crete an environment where entrepreneurial culture can flourish.

To this end, we have created the Regional Council of Innovation of Crete, which links all governmental and non-governmental operators on the island to help them develop new ideas and suggests new directions for Crete's productive sectors.

At the same time, a collaborative workspace is being set up under the Regional Council of Innovation's direction to provide facilities for young entrepreneurs and young enterprises (co-work spaces, workshops, events, public services to citizens, corporate or freelance space rental etc.), and to host the Network of Entrepreneurship and Innovation. This Network will connect entrepreneurs with academic and research institutions in Crete as well as with local government organisations. Furthermore, a Centre of Excellence for research and applied policies in public management, in education, social and regional policy, economics and sustainability will also be set up within the same facilities.

Another example of our progressive work is a new institutional event called IDEOPOLIS (meaning 'city of ideas'). Its aim is to foster and facilitate significant entrepreneurial competition for youth. It will work with partners from abroad to promote the international exposure of young entrepreneurs and businesses and, offering also tutorials in business planning and business operations.

It is true that in our country, Greece, the problem of youth unemployment is more severe than in other European countries, since one young Greek in two is currently unemployed. Our objective is to identify what each of us can do as a team, individually but also as administrative entities. Our ultimate goal is to contribute significantly to a change of the current adverse economic climate, by maintaining existing jobs and creating new ones, particularly for young people.




The national context:
Youth unemployment reached 57.6% in October 2012. Greece is one the EU Member States hardest hit by the current economic crisis, and this has particularly affected youth unemployment. Already in 2009, overall labour force participation stood at 66%, which was lower than the EU27 average of 73%. As for youth labour force participation, it has traditionally been one of the lowest in Europe.

Furthermore, Greece has an education system that struggles to address mismatches in skills supply and demand, and to effectively respond to labour market needs. Despite all this, the most serious threat to youth employment is the continued austerity measures: it is cheaper to fire workers with the least work experience and unemployment benefits are now higher than part-time wages for young people. This is why many Greek young people decide to emigrate, discouraged by low wages and severe competition for fewer jobs.

It is worth noting that within the framework of the Economic Adjustment Programme for Greece, minimum wages in the private sector for workers under 25 have been reduced by 32%. What is more, gender inequality has deepened, with every second young female now being unemployed. Moreover, regional disparities in youth unemployment have been temporarily abolished, but for the wrong raisons since all regions now present very high rates of youth unemployment given their uniformly bad economic performance.

Existing measures are largely co-financed by the ESF. The Greek Manpower Organisation (OAED) plays a key role, offering training programmes for skills acquisition and job search assistance. It operates 51 vocational education schools (in-class education combined with remunerated apprenticeships) and provides incentives for internships (where the trainee is paid 80% of the wage of an unskilled worker and OAED reimburses the employer up to 50% of the wage paid). There are also ESF co-financed schemes for work-based training for students in the upper secondary, post-secondary and tertiary education.

Two schemes co-financed by the ESF, with an overall budget of EUR 95 million, provide support to employers to hire a) young people aged 15-24 (EUR 27 million), and b) unemployed university graduates up to the age of 35.  Another ESF co-financed scheme with a budget of EUR 52 million seeks to enhance access to employment and business creation for people threatened by unemployment, unemployed/job-seekers and inactive people.

All in all, a substantial part of the Structural Funds is currently allocated to the promotion of entrepreneurship and business creation opportunities for young unemployed and young professionals up to the age of 35. However, it is not clear how much of the ESF's financial envelope destined to actions to support job creation and boost employability (EUR 786 million in total) is targeted only at youth.

In order to combat and prevent youth unemployment, the Greek government has committed to expanding and reinforcing existing initiatives co-funded by the EU funds, and to re-allocating resources across operational programmes. Moreover, an action plan is under preparation and it foresees targeted interventions to boost young people's employment and entrepreneurship. It will be mainly supported with funds under the Greek National Strategic Reference Framework 2007 – 2013.



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