TWN Info Service on UN Sustainable Development (Aug26/03)
13 August 2026
Third World Network

ILO: Global youth unemployment rises amid AI disruption
Published in SUNS #10503 dated 13 August 2026

Geneva, 12 Aug (D. Ravi Kanth) -- The International Labour Organization (ILO) on 11 August released a report warning that governments must quickly renew their commitment to integrated youth employment strategies amid worsening global unemployment and the denial of decent living standards worldwide.

The "Global Employment Trends for Youth 2026" report starkly warns that failure to adopt urgent and appropriate policies will not only waste the potential of a generation but will also deepen social inequalities and create a global "lost generation" of disengaged youth.

Faced with the growing deployment of Artificial Intelligence (AI) and related technologies, the ILO report calls on governments to ensure that technology and economic growth work for young people, thereby ensuring a more equitable and decent future for all.

The 2026 edition of the report concludes that the central challenge for the world is not solely about generating more jobs for young people, but ensuring that these jobs provide the security, dignity, and opportunities that underpin a successful transition to adulthood.

The central message of the report emphasizes: "Rebuilding confidence among today's youth will require renewed investment in decent work, stronger labour market institutions, and policies capable of helping young people navigate an increasingly uncertain future while ensuring that technological progress and economic transformation work for, rather than against, the next generation."

Among other findings, the tentative and short-lived recovery in youth labour markets that followed the COVID- 19 pandemic has come to a grinding halt. It paints a grim picture of a world where the transition from school to decent work is becoming increasingly difficult for a vast number of young people.

Worse still, recent explosive protest movements by unemployed youth in countries such as India, Nigeria, Sri Lanka, and Nepal seemingly expose the failure of governments to implement proper labour-generating policies because of neoliberal economic policies aimed at enriching the affluent sections of society, several commentators and analysts said.

According to the ILO report, this deterioration is attributed to a confluence of factors, including slowing global economic growth, diminished job creation, persistent geopolitical tensions, and rapid technological change.

The proverbial writing on the wall appears to be that the foundations for youth labour market entry are becoming more precarious across the globe.

DETERIORATING LANDSCAPE

The ILO says that after reaching its lowest level in over two decades in 2023, the global youth unemployment rate for those aged 15 to 24 has edged upwards. In 2025, it rose to 12.4 per cent, representing 67 million unemployed young people worldwide.

More alarmingly, the rate of young people not in employment, education, or training (NEET) is also on the rise again, increasing from 19.7 per cent in 2023 to 20 per cent in 2025. This translates into an additional 9 million young people falling into NEET status, bringing the total to a staggering 257 million in 2025.

"With many more young people implicated and with youth disengagement harder to redress, the increasing trend in the youth NEET rate is especially worrisome," the ILO warned.

According to the report, this trend is particularly worrying because being NEET represents a state of disengagement from both the workforce and the education system, making it extremely difficult for individuals to reintegrate and build a stable career path.

Unlike previous editions where trends varied significantly across regions, the recent worsening of job entry for young people has been almost universal.

The report offers several stark messages:

* Geographic breadth: The youth unemployment rate rose between 2023 and 2025 in 8 of the 11 subregions analysed, as well as across high-income, lower-middle-income, and low-income countries.

* Hotspots: The most significant increases in youth unemployment were observed in Northern Africa, Northern America, and Northern, Southern Asia, and Western Europe.

* While regions like Central and Western Asia, Eastern Europe, and upper-middle-income countries saw a decline in the youth unemployment rate, this "good news" was muted by a simultaneous rise in their NEET rates.

Significantly, Latin America and the Caribbean showed a decline in both indicators.

However, this was partly driven by a shrinking youth population, and many individual countries within the region still experienced worsening trends in youth labour market engagement.

Furthermore, "Unlike in previous editions of the GET for Youth, where the trends on the main labour market indicators varied widely across subregions, the worsening results on job entry for young people have been almost universal over the past couple of years."

GENDER GAP

The report suggests a deeply entrenched and widening gender gap in labour market entry. Young men continue to hold a distinct advantage.

* NEET disparity: The NEET challenge has a distinctly "female face." In 2025, more than two out of every three young people in NEET status were women.

* Rate differences: The global NEET rate for young women stood at 27.4 per cent, which is more than double the rate for young men at 13.1 per cent.

* Widening gap: The increase in the NEET rate since 2023 was steeper for young women (rising by 0.5 percentage points) compared to young men (rising by 0.2 percentage points), thereby expanding the gender gap even further.

Conversely, the gender gap in employment-to-population ratios narrowed slightly, but a massive chasm remains.

The employment-to-population ratio for young men was 43.3 per cent, nearly 13 percentage points higher than that for young women (30.6 per cent).

Clearly, the report suggests that "gender gaps remain entrenched; young men still have the advantage in labour market entry."

Clarifying this point, the report argues that this gap is not due to unequal access to education, as young men and women are now on par in terms of school enrolment.

However, the gap is driven by the significantly higher propensity of young women to be in NEET status due to inactivity outside of school.

According to the report, persistent barriers such as unpaid care responsibilities, discrimination, and limited access to quality employment continue to constrain young women's economic participation, particularly in the Arab States, Northern Africa, and Southern Asia.

REGIONAL PICTURE

The report provides stark regional analyses, highlighting the different but equally severe challenges young people face.

1. The Arab States and Northern Africa: A deepening crisis

These regions consistently have the world's highest youth unemployment rates. In 2025, more than one in five economically active young people in the Arab States and Northern Africa struggle to find work, with unemployment rates of 26.2 per cent and 22.6 per cent, respectively. At the same time, at least one in three young people is in NEET status (rates of 32.4 per cent and 30.1 per cent, respectively).

"When these indicators continue to rise from already high levels, it signals a deepening of the already well-rooted structural barriers that push young talent - young women particularly - to the margins of productive society."

2. Sub-Saharan Africa

The situation in sub-Saharan Africa represents another extreme, defined by a paradox of low unemployment and high precariousness. The youth unemployment rate was just 8.4 per cent in 2025, 4 percentage points below the global average. However, this is not a sign of a healthy labour market; it reflects a context where few can afford to be without work. Most young people must generate an income, often taking up informal jobs that lack social protection and stability.

* Informality: Nearly nine in ten young workers in low- and lower-middle-income countries, many of which are in sub-Saharan Africa, remain in informal employment. Two in three were still in insecure forms of work as young adults (aged 25-29), such as own-account workers or temporary paid workers.

* Population pressure: The region faces immense population pressure, accounting for nearly two-thirds of the increase in the global youth population. With millions of new entrants competing for a limited number of decent jobs, the rising NEET rate in the region signals growing youth discouragement.

3. High-income countries

"The growing hardship of labour market entry in high-income countries is a relatively recent phenomenon," the ILO said.

The report suggests that while young people in high-income countries typically have access to more secure forms of work - formal employment is the norm (only 11.7 per cent work informally), and the majority (75 per cent) of young adult workers are in secure forms of paid employment - their pathway to these jobs has become increasingly difficult.

* The youth unemployment rate rose sharply in Northern America, from 8.3 per cent in 2023 to 9.8 per cent in 2025.

* Northern, Southern and Western Europe also saw an increase, with the rate remaining high at 15 per cent in 2025. Of the 29 countries in the subregion, 20 saw a worsening capacity to absorb young talent.

* Interestingly, young people who finished school at the secondary level in these regions are confronting the greatest obstacles, with their situation worsening to a similar degree as that of university graduates.

The report signals that a fundamental driver of the crisis is that job creation is not keeping up with the growth of the youth population in multiple regions. As of 2024, youth population growth outpaced total employment growth in Eastern Asia, Eastern Europe, Northern America, and Northern, Southern and Western Europe.

While youth employment stagnates or declines, adult employment continues to expand. This has led to a diverging trend in unemployment rates: the global youth unemployment rate increased from 12.3 per cent in 2023 to 12.4 per cent in 2025, while the adult rate decreased from 3.7 per cent to 3.6 per cent.

Consequently, the ratio of the youth-to-adult unemployment rate has increased to 3.4 in 2025, signalling heightened difficulties for the global economy to onboard young talent.

AI HOLLOWING OUT

The report analyses the evolving structure of employment, pointing to a "hollowing out" of middle-skilled jobs, a trend that is being exacerbated by technological change, including Artificial Intelligence (AI).

Recently, at the Indian headquarters of Oracle in Bangaluru, thousands of middle-skilled IT jobs were terminated on short notice.

The Financial Times, in its report titled "the AI threat to Indian IT jobs machine," published on 11 August, grimly pointed out that "many of the formulaic tasks that underpin the industry, which employs 6 million people and contributes about 7 per cent of GDP, can now be performed by generative AI."

"If the sector cannot pivot to higher-value work, that could spell more trouble for a government already struggling to create enough jobs for India's huge workforce," the FT report maintained.

The report says that the most persistently affected jobs are in middle-skilled occupations, such as clerical support, service and sales work, craft and related trades, and plant and machine operators. This overlaps significantly with occupations deemed most exposed to disruption by AI, mainly clerical and administrative roles.

The ILO report estimates that 6.1 per cent of jobs currently held by young people aged 15 to 29 fall into the categories most exposed to AI and thus most at risk of job replacement.

The report warns that if only 10 per cent of these jobs were to disappear fully, it would translate into 5.6 million employed youth - largely in high-income countries - facing unemployment or requiring a job change.

Conversely, jobs in high-skilled knowledge-based technical areas, like science, engineering, health, and ICT, have fared better. Growth in these areas was positive across all country income groups but was especially strong in low- and lower-middle-income countries.

"BACK TO THE FUTURE"

In a crux, the ILO report argues that the current challenges, while sharing similarities with past economic downturns, are also different.

The situation is not underpinned by an obvious single crisis; rather, it is a pervasive sense of uncertainty fuelled by technological disruption and muted economic growth.

To address this, the report calls for bold and adaptive policies built around four pillars:

1. Creating employment opportunities: Implementing gender-responsive macroeconomic and sectoral policies, and supporting enterprise development and entrepreneurship.

2. Preparing young people: Ensuring access to quality education, apprenticeships, and lifelong learning systems to equip youth with the skills they need.

3. Facilitating labour market transitions: Modernising employment services and implementing effective active labour market policies that help match youth with jobs.

4. Ensuring inclusion: Expanding social protection, enforcing rights at work, and providing targeted support for disadvantaged groups.

To bring young people "back to the future" where labour market pathways lead to secure and decent work, the report outlines six specific adaptive policy areas:

* Adopting a human-centred approach to AI governance.

* Investing in skills that combine technical competencies with social and cognitive capabilities.

* Strengthening lifelong learning systems.

* Modernizing employment services.

* Expanding social protection to cover diverse forms of work.

* Strengthening international cooperation to reduce widening inequalities in opportunities across countries.

Consequently, while calling for substantially more investments in the next generation, the ILO report maintains that the central challenge for the world is not solely about generating more jobs for young people, but ensuring that these jobs provide the security, dignity, and opportunities that underpin a successful transition to adulthood.

The ILO maintained that "rebuilding confidence among today's youth will require renewed investment in decent work, stronger labour market institutions, and policies capable of helping young people navigate an increasingly uncertain future while ensuring that technological progress and economic transformation work for, rather than against, the next generation." +