IMF & World Bank austerity leaves young people in the lurch

Friday, October 12, 2018 - 09:16

As finance ministers, policy makers and civil society gather in Bali for 2018 Annual Meetings of the International Monetary Fund and the World Bank Group, young people can really take this opportunity to remind ourselves just how much we’ve lost. Forty years of neoliberal policies rolled out by international finance institutions have eroded our social, economic and cultural rights.

For the youth of today – Millennials born in the 1980s, and Generation Z born in the 2000s – precarious work, commodified rights and privatised social services are the norm. We were raised in an era of neoliberal ascendancy, corporate captures of states and aggressive austerity. According to the International Labour Organisation, only 29% of people globally enjoy access to comprehensive social security, while just 22% of unemployed workers are covered by unemployment benefits. Large numbers of young people either have no social protection at all or their social benefits have been reversed.

Our parents and grandparents grew up in and lived through three decades of very high rates of social progress, progress that was achieved through state interventions on economic and social policy. If we look back to these 30 years between 1950 and 1980 when developmental and welfare states were in place, it’s clear that scaled up social protections had significantly contributed to progress in both developed and developing countries. These took the form of free or affordable health care and education for all, social security benefits (like unemployment benefits and pensions), employment-centred economic policies and hard-won labour rights.

Even under developmental and the welfare states, women’s burden of reproducing and taking care of the labour force was partly redistributed to the state though the public provisioning of care and other public services. Now, under neoliberal privatisation and state withdrawal from providing public services and infrastructure, the cost of reproducing and caring for the workforce is now shouldered solely by women. Any statistical economic benefits posted by states and corporations as a result of these policies are profiting from women’s increased unpaid labour.

Our lives and futures are seriously threatened by a global youth unemployment crisis, dire poverty and rapid climate change. The high cost of privatised services like education and health, the flexibilization of the labour market and rise of the gig economy, together with all-round attacks on labour unions and collective power, mean that many young people cannot find decent jobs - thrusting us into precarity and poverty. 

Despite the World Bank and IMF persistently pushing states to cut spending on social protection, because it is ostensibly ‘unaffordable’, no government should abdicate its primary responsibility to provide safety nets to all citizens. Social protection is totally affordable - advocates for universal social protection floors have shown that a commitment of just 1–2% of GDP or 5-10% of national budgets would be enough to provide everyone with a minimum standard of social security

The challenges of youth unemployment, economic instability and climate change, as well as our commitments to attain the Sustainable Development Goals (SDGs), call for much more pressure from young people. We must fight for greater investment in state capacity and the public sector and an end to false-solutions.

We need to demand social protection as an economic and political necessity to realise our right to self-determination. Our futures depend on it. Social protection is not charity, a handout, nor an act of kindness, it is a human right!

Read ActionAid's draft report on Youth, Gender and Social Protection: Rebuilding systems for the 21st Century.