WEBVTT

00:00:00.000 --> 00:00:02.037
Right now, somewhere in a wealthy country,

00:00:02.120 --> 00:00:05.672
there's a young person who woke up
this morning with no work, no school,

00:00:05.755 --> 00:00:07.297
and no plan to look for either.

00:00:07.380 --> 00:00:10.680
and tomorrow will be the same
and the day after that.

00:00:10.763 --> 00:00:15.468
Except it's not just one person.
Today, 262 million young people are living

00:00:15.551 --> 00:00:20.020
exactly like this. That's 1 in 4
worldwide. And they even have a name.

00:00:20.130 --> 00:00:24.130
They're called NEETs,
not an employment education or training.

00:00:24.240 --> 00:00:27.981
Now, the instinct most people have when
they hear that is pretty predictable.

00:00:28.065 --> 00:00:31.687
Lazy generation, too soft, should just
get off their phones and get a job.

00:00:31.770 --> 00:00:35.094
If you've ever had to sit through
a family dinner with anyone over 55,

00:00:35.178 --> 00:00:37.577
you've probably heard some
version of this already.

00:00:37.660 --> 00:00:39.719
But the data tells
a more complicated story,

00:00:39.802 --> 00:00:43.370
because youth unemployment has actually
been going down across most wealthy

00:00:43.453 --> 00:00:44.617
nations at the same time.

00:00:44.700 --> 00:00:47.940
So by the official measure,
young people are doing fine.

00:00:48.030 --> 00:00:52.176
It's just that the official measure of
youth unemployment only counts people who

00:00:52.259 --> 00:00:55.400
are actively looking for jobs,
so it misses the rest of them.

00:00:55.484 --> 00:00:57.938
For every young person
counted in a... With Zip,

00:00:58.021 --> 00:01:01.427
you can get the filling you need
and the flights to Fiji you want.

00:01:01.510 --> 00:01:03.911
You can get what you need want.
It pays to Zip.

00:01:03.995 --> 00:01:06.184
T's and C's credit
approval criteria apply.

00:01:06.268 --> 00:01:08.827
Credit provided by Zip
Money Payments Pty Limited.

00:01:08.911 --> 00:01:11.999
Australian Credit License
441878....unemployment statistics,

00:01:12.083 --> 00:01:14.990
there are roughly three more
who aren't counted at all.

00:01:18.030 --> 00:01:21.668
lazy ones your uncle was talking about
at dinner. But if your uncle were right,

00:01:21.751 --> 00:01:25.436
the picture would look very different.
You wouldn't expect it to skew so heavily

00:01:25.520 --> 00:01:27.980
toward people with health
conditions and disabilities,

00:01:28.063 --> 00:01:30.948
or to be concentrated in places
where jobs are hardest to find.

00:01:31.031 --> 00:01:34.009
And you wouldn't expect it to be
getting worse in countries that,

00:01:34.093 --> 00:01:36.789
by every other economic measure,
are supposedly doing well.

00:01:36.872 --> 00:01:40.274
Something structural is going on.
The foundational promise of every modern

00:01:40.358 --> 00:01:43.666
economy is that each generation enters
the workforce, contributes to it,

00:01:43.749 --> 00:01:44.599
and does a little

00:01:48.030 --> 00:01:51.756
share of young people is struggling
to become economically active at all,

00:01:51.839 --> 00:01:54.522
let alone build a better
life than their parents. So,

00:01:54.605 --> 00:01:58.383
what exactly is a NEAT and why does
it tell us something about the economy

00:01:58.466 --> 00:02:02.453
that unemployment figures never could?
Why is this happening now and why is it

00:02:02.537 --> 00:02:03.997
happening everywhere at once?

00:02:04.080 --> 00:02:08.520
And finally, what does it actually cost
and do we already know how to fix it?

00:02:08.940 --> 00:02:12.453
Now, to understand why the NEAT number
tells us something the unemployment rate

00:02:12.536 --> 00:02:15.684
never could, you need to understand
how the unemployment rate is built.

00:02:15.768 --> 00:02:19.371
The unemployment rate counts people who
don't have a job and are actively looking

00:02:19.454 --> 00:02:21.738
for one. And actively
is the word that matters here.

00:02:21.821 --> 00:02:25.061
Because to be counted as unemployed,
you have to be sending applications,

00:02:25.144 --> 00:02:27.382
attending interviews,
registering with job centres,

00:02:27.466 --> 00:02:30.614
and responding to job listings.
The moment you stop doing those things,

00:02:30.697 --> 00:02:34.255
for whatever reason, you're no longer
unemployed and become what economists call

00:02:34.339 --> 00:02:35.439
economically inactive,

00:02:38.940 --> 00:02:42.644
you. Since unemployment benefits in most
countries are tied to actively looking

00:02:42.728 --> 00:02:45.238
for work, stopping looking
cuts you off from the support.

00:02:45.321 --> 00:02:48.469
The unemployment rate is useful
for counting people available and ready

00:02:48.552 --> 00:02:51.655
to work right now, but it was never
designed to answer the much bigger

00:02:51.738 --> 00:02:55.295
question of how many young people are
genuinely struggling to build a productive

00:02:55.379 --> 00:02:57.434
life. And that means it
misses a lot of people,

00:02:57.517 --> 00:03:01.029
like the ones who stopped looking after
months of rejection and those who can't

00:03:01.112 --> 00:03:04.447
work because of a health condition
that has never been formally diagnosed.

00:03:04.530 --> 00:03:07.981
There are also the ones caring for a sick
parent or a young child with no one else

00:03:08.064 --> 00:03:11.601
to help, and those who live in towns where
the available jobs pay less than the cost

00:03:11.685 --> 00:03:15.006
of getting to them. None of these people
are unemployed in the technical sense,

00:03:15.089 --> 00:03:18.626
they're just invisible to the economy and
the neat measure was invented specifically

00:03:18.710 --> 00:03:22.375
to fine them. By capturing everyone
between 15 and 24 who isn't working,

00:03:22.459 --> 00:03:26.288
studying or in any formal training,
regardless of whether they're looking

00:03:26.371 --> 00:03:30.522
or not, we're able to get a much more
complete picture of what's actually going

00:03:30.605 --> 00:03:33.845
on. In 2023, only 6% of young
people globally were unemployed,

00:03:33.928 --> 00:03:38.240
but 20.4% were NEAT. Now it's worth being
honest about what's inside that measure,

00:03:38.323 --> 00:03:42.152
because not every NEAT is the same,
and if you treat them as if they are,

00:03:42.236 --> 00:03:45.130
the policy response ends up
aimed at the wrong people.

00:03:49.350 --> 00:03:51.667
countries where the story
looks quite different.

00:03:51.750 --> 00:03:54.983
There, entire regions lack
the infrastructure for formal employment,

00:03:55.066 --> 00:03:57.665
and in parts of sub-Saharan
Africa and the Middle East,

00:03:57.748 --> 00:04:00.347
conflict has simply made
education and work impossible.

00:04:00.431 --> 00:04:04.395
In most of those regions, young women are
also kept out of work by early motherhood

00:04:04.478 --> 00:04:07.419
or cultural expectations.
Those are real and serious problems,

00:04:07.502 --> 00:04:09.467
but they're a topic for a different video.

00:04:09.550 --> 00:04:12.344
What we're focused on here
is the needs in wealthy nations.

00:04:12.428 --> 00:04:15.612
These countries have functioning
economies, good education systems,

00:04:15.695 --> 00:04:18.745
and social safety nets,
and yet the problem exists there too.

00:04:21.750 --> 00:04:25.230
two very different groups of needs,
living very different lives.

00:04:25.350 --> 00:04:27.314
The first group are
the voluntarily disengaged.

00:04:27.398 --> 00:04:29.492
These are young people
who have made a deliberate,

00:04:29.576 --> 00:04:33.065
if sometimes questionable, choice to step
back from the conventional path for now,

00:04:33.148 --> 00:04:35.635
or they are simply between
things and on their way back in.

00:04:35.718 --> 00:04:38.902
Some are holding out for the right
opportunity rather than taking the first

00:04:38.986 --> 00:04:42.387
thing that comes along, while others are
trying to build something on their own.

00:04:42.471 --> 00:04:45.873
And some, if we're being honest, are just
riding it out at their parents' house,

00:04:45.956 --> 00:04:47.556
waiting for something to change.

00:04:55.350 --> 00:04:58.807
But they're a minority, and a smaller
one than the headlines tend to suggest.

00:04:58.890 --> 00:05:01.014
In Europe, where we have
the most detailed data,

00:05:01.097 --> 00:05:04.784
they account for only one in five NEETs.
The other four in five are people who are

00:05:04.867 --> 00:05:08.324
disconnected from work or education,
less by choice and more by circumstance.

00:05:08.407 --> 00:05:10.807
Some are actively looking
for work but not finding it,

00:05:10.890 --> 00:05:14.439
while others have become discouraged
after so many rejections that they stopped

00:05:14.522 --> 00:05:15.422
trying altogether.

00:05:25.350 --> 00:05:28.834
86% in 2015 to 44% in 2025,
nearly doubling in a single decade.

00:05:28.917 --> 00:05:32.968
Then there are young people with
caretaking responsibilities and this one

00:05:33.051 --> 00:05:36.762
skews heavily female. 1 in 5 NEAT
women are looking after children,

00:05:36.845 --> 00:05:41.178
compared to just 1 in 30 for young men.
When childcare costs more than the job

00:05:41.262 --> 00:05:43.953
pays, or when there's
simply nobody else to help,

00:05:44.036 --> 00:05:48.143
the choice to work doesn't exist.
Now despite how different the situations

00:05:48.226 --> 00:05:52.507
of the vulnerable NEATs are, the data
points to the same profile every time.

00:05:52.590 --> 00:05:54.815
They tend to come from
lower income families.

00:05:54.898 --> 00:05:57.790
They're more likely to live
in rural areas than in cities,

00:05:57.873 --> 00:06:01.226
and the less education someone has,
the higher the risk. In the US,

00:06:01.309 --> 00:06:04.406
a quarter come from families
earning less than $25,000 a year,

00:06:04.489 --> 00:06:08.467
and the rate among black youth is more
than 50% higher than among white youth.

00:06:08.550 --> 00:06:11.868
Patterns like these point much more
towards structural disadvantage than

00:06:11.952 --> 00:06:14.514
individual choice.
If this were just a laziness problem,

00:06:14.597 --> 00:06:18.388
you wouldn't have nearly a million young
people in the UK sitting in this category

00:06:18.471 --> 00:06:21.978
right now. The highest number in over
a decade in a country that spent years

00:06:22.062 --> 00:06:25.616
making progress on exactly this problem.
And while meat rates in most wealthy

00:06:25.699 --> 00:06:28.970
countries have been improving for years,
that progress has now stalled.

00:06:29.053 --> 00:06:31.049
Now at this point you're
probably wondering,

00:06:31.132 --> 00:06:33.883
if these young people have no
paycheck and no training wage,

00:06:33.967 --> 00:06:37.717
who's actually paying for dinner?
The short answer is mostly their parents.

00:06:38.550 --> 00:06:42.201
more than half of American parents with
a child over 18 are providing financial

00:06:42.284 --> 00:06:44.470
support, at an average
of nearly $1,500 a month.

00:06:44.553 --> 00:06:48.015
The state picks up some of the rest,
mostly through health-related benefits

00:06:48.098 --> 00:06:51.134
for those who can't work.
But the full answer is more complicated.

00:06:51.218 --> 00:06:53.309
We go into it in depth
in our next newsletter,

00:06:53.392 --> 00:06:56.317
which you can subscribe to through
the link in the description.

00:06:56.400 --> 00:07:00.610
So how did we get here? Why is the
economy failing so many young people?

00:07:00.900 --> 00:07:03.816
The honest answer is that this didn't
happen because of one thing.

00:07:03.899 --> 00:07:07.178
Several things went wrong at once
and young people ran into all of them at

00:07:07.261 --> 00:07:10.237
the start of adult life when you
have nothing to cushion the fall.

00:07:10.320 --> 00:07:14.010
For most of the 20th century, the economy
had a reasonably reliable first rung

00:07:14.093 --> 00:07:17.058
on the ladder. Jobs like factory
work, admin roles, data entry,

00:07:17.141 --> 00:07:20.395
retail management or customer service
didn't require much experience.

00:07:20.479 --> 00:07:24.265
Entry level jobs also paid a living wage
and taught you enough about how to show

00:07:24.349 --> 00:07:27.894
up, take direction and build a work
history that the next job became easier

00:07:27.977 --> 00:07:31.812
to get. They weren't glamorous, but for
an 18 year old with no credentials and no

00:07:31.895 --> 00:07:33.487
connections, they were the way in.

00:07:33.570 --> 00:07:37.018
Those jobs are now disappearing.
Automation took the most routine roles

00:07:37.102 --> 00:07:40.600
first, like data entry, basic processing
and repetitive customer service

00:07:40.683 --> 00:07:44.381
interactions, and now AI is doing
the same to entry level white collar work.

00:07:44.464 --> 00:07:48.509
Between late 2022 and mid 2025, employment
for new workers in the jobs most exposed

00:07:48.593 --> 00:07:52.439
to AI fell 6%, while older workers in
those same fields actually saw employment

00:07:52.522 --> 00:07:55.075
grow. The gig economy
absorbed much of what remained,

00:07:55.159 --> 00:07:59.105
replacing stable entry level employment
with flexible work that sounds appealing,

00:07:59.188 --> 00:08:02.688
until you realize it offers no
progression, no training and no way up.

00:08:02.880 --> 00:08:05.773
Now, the obvious response to all
of this is "go to university,

00:08:05.856 --> 00:08:08.749
get the degree and that should
open the door to better roles".

00:08:08.832 --> 00:08:12.445
And despite everything, it's true that
a degree is still effectively required

00:08:12.528 --> 00:08:15.277
for most good jobs, whatever
the job posting actually says.

00:08:15.360 --> 00:08:19.021
Companies have spent the last few years
publicly dropping degree requirements,

00:08:19.104 --> 00:08:22.573
but fewer than one in 700 new hires
actually benefited from those changes.

00:08:22.656 --> 00:08:24.589
So the degree is still the price of entry.

00:08:24.672 --> 00:08:28.237
The problem is what it now costs to get
one and what it actually delivers on

00:08:28.320 --> 00:08:31.702
the other side. In the UK,
tuition fees tripled in 2012. In the US,

00:08:31.786 --> 00:08:35.599
the average student borrower carries
nearly $40,000 in federal debt alone.

00:08:35.683 --> 00:08:39.760
Young people took on that debt on the
reasonable assumption that a degree would

00:08:39.843 --> 00:08:43.687
translate into a graduate level job,
but the labour market hasn't kept up.

00:08:43.770 --> 00:08:48.135
In 2024 over a million students graduated
from UK universities in a single year,

00:08:48.218 --> 00:08:52.583
but the share of them landing in roles
that actually require a degree has fallen

00:08:52.666 --> 00:08:54.367
to its lowest level since 2014.

00:08:54.450 --> 00:08:57.937
And for the first time on record, the
unemployment rate for recent US graduates

00:08:58.020 --> 00:09:00.337
has started to exceed
the overall unemployment rate.

00:09:00.420 --> 00:09:04.006
So the degree costs more than it used
to and delivers less than it promised.

00:09:04.089 --> 00:09:07.357
And the jobs that didn't require
one have largely disappeared anyway.

00:09:07.440 --> 00:09:10.427
On top of all that,
the post-pandemic hiring boom has cooled,

00:09:10.511 --> 00:09:14.303
hitting young workers first. In the UK,
employment among young people in 2025

00:09:14.387 --> 00:09:16.669
still hadn't recovered
to where it was in 2019,

00:09:16.752 --> 00:09:19.136
even as adult employment
has grown steadily. Now,

00:09:19.219 --> 00:09:23.112
that alone would be a serious problem,
but it's also happening at a moment when

00:09:23.196 --> 00:09:26.485
getting to the jobs that do exist
has become a challenge in itself.

00:09:26.568 --> 00:09:29.908
The best jobs in any given field
tend to cluster in specific cities,

00:09:29.991 --> 00:09:32.626
finance in London and New York,
tech in San Francisco.

00:09:32.709 --> 00:09:35.780
For previous generations,
moving to where the opportunity was

00:09:37.440 --> 00:09:41.242
a reasonable rent. In 1960 the typical
renter spent less than a fifth of

00:09:41.325 --> 00:09:45.363
their income on housing, Today it's
closer to a third, and that's the average.

00:09:45.446 --> 00:09:49.417
In the cities where the jobs actually are,
it's considerably worse than that.

00:09:49.500 --> 00:09:54.812
In Sydney, the income you need just
to rent a typical apartment without being

00:09:54.895 --> 00:09:59.927
in financial stress has jumped from
$88,000 in 2019 to $130,000 in 2025.

00:10:00.010 --> 00:10:04.307
young worker in New South Wales earns
around 54,000 Australian dollars.

00:10:04.390 --> 00:10:07.889
In the US, 3 in 5 Gen Z renters
are now classified as rent burdened,

00:10:07.973 --> 00:10:12.104
spending more than 30% of their income
on housing before accounting for anything

00:10:12.187 --> 00:10:15.792
else. In cities like Los Angeles
and San Diego, it's closer to 3 in 4.

00:10:15.875 --> 00:10:19.954
The result is that young people put 2
and 2 together and decide the move simply

00:10:20.038 --> 00:10:24.169
isn't worth it. So they stay in the town
they grew up in where the opportunities

00:10:24.252 --> 00:10:28.437
are thinner and the neat risk is higher.
Or they move back in with their parents,

00:10:28.520 --> 00:10:32.388
which is now the living situation
of roughly 1 in 4 young adults in the US,

00:10:32.471 --> 00:10:34.187
up from 1 in 9 just 50 years ago.

00:10:34.270 --> 00:10:36.490
And while that arrangement
can make financial sense,

00:10:36.573 --> 00:10:40.247
it often comes with a growing feeling that
adulthood has been indefinitely delayed.

00:10:40.330 --> 00:10:44.096
None of this, it turns out, is
particularly good for your mental health.

00:10:44.180 --> 00:10:48.213
The share of young people in the UK
reporting common mental health conditions

00:10:48.297 --> 00:10:51.475
has risen from 19% in 2014
to nearly 26% today. In Australia,

00:10:51.558 --> 00:10:55.646
the prevalence of depression among young
adults more than doubled between 2007

00:10:55.729 --> 00:10:58.533
and 2021. And in the US,
for the first time on record,

00:10:58.616 --> 00:11:02.810
young people aged 18 to 24 are now more
likely to report poor mental health than

00:11:02.894 --> 00:11:06.690
people twice their age. Now,
the obvious question is, which came first?

00:11:10.330 --> 00:11:14.241
health crisis already developing on its
own and simply made navigating those

00:11:14.324 --> 00:11:17.110
pressures harder. Well,
it's genuinely a bit of both.

00:11:17.290 --> 00:11:19.810
And that's what makes
this so difficult to fix.

00:11:20.170 --> 00:11:22.438
The structural pressure
argument is intuitive.

00:11:22.521 --> 00:11:24.943
A generation dealing
with an unstable job market,

00:11:25.026 --> 00:11:29.032
serious debt and housing they can't afford
is a generation under chronic stress.

00:11:29.115 --> 00:11:31.639
And chronic stress
is detrimental to mental health.

00:11:31.722 --> 00:11:33.939
The pandemic made things
significantly worse,

00:11:34.022 --> 00:11:36.648
but young people were already
struggling long before.

00:11:36.732 --> 00:11:40.226
The numbers started moving in the
wrong direction as far back as 2011,

00:11:40.310 --> 00:11:44.417
years before the post-pandemic jobs crunch
and the current cost of living crisis.

00:11:44.500 --> 00:11:48.901
In the UK, depression among young people
aged 15 to 24 had already nearly doubled

00:11:48.985 --> 00:11:53.330
between 2003 and 2019. And struggling
with your mental health at 15 doesn't make

00:11:53.414 --> 00:11:57.347
showing up to school any easier,
which means your qualifications suffer.

00:11:57.430 --> 00:12:00.301
Worse qualifications mean worse
options in the labour market,

00:12:00.384 --> 00:12:03.642
which makes mental health worse.
Each step makes the next one harder,

00:12:03.726 --> 00:12:05.821
and the further someone
gets down that chain,

00:12:05.905 --> 00:12:09.453
the harder it is to pull them back.
Now for the ones who do make it through

00:12:09.537 --> 00:12:12.843
and actually land a job, well,
the conditions on the other side aren't

00:12:12.927 --> 00:12:17.267
exactly a relief. One job,
it turns out, increasingly isn't enough.

00:12:17.350 --> 00:12:21.890
There are now a record 1.35 million adults
in the UK working at least two jobs,

00:12:21.973 --> 00:12:24.467
and it's Gen Z driving
most of that growth.

00:12:24.550 --> 00:12:28.396
and yet more than two thirds of them still
rely on parents or family for essentials

00:12:28.480 --> 00:12:31.332
like rent, groceries or bills.
For those working a single job,

00:12:31.415 --> 00:12:33.604
the hours don't stop
at the hours you agreed to.

00:12:33.687 --> 00:12:36.918
Over a third of workers say their
employer expects them to work beyond

00:12:37.001 --> 00:12:40.422
their contracted hours, and nearly
a quarter of Gen Z's answer work emails

00:12:40.505 --> 00:12:42.737
outside normal hours
at least five days a week.

00:12:42.820 --> 00:12:45.458
The gig economy promised
flexibility, which sounds good,

00:12:45.541 --> 00:12:49.345
but that flexibility mostly just means
the risk sits with the worker rather than

00:12:49.428 --> 00:12:52.941
the employer. You're available when they
need you, and the rest is your problem.

00:12:53.024 --> 00:12:55.987
Half of Gen Z workers report feeling
burned out, and the friendships,

00:12:56.071 --> 00:12:59.475
the local communities, the places to
switch off that previous generations could

00:12:59.559 --> 00:13:01.992
fall back on, those have been
thinning out for years too.

00:13:02.076 --> 00:13:05.392
So some young people who do find work
eventually decide it simply isn't worth

00:13:05.475 --> 00:13:08.836
it. And when they step back, there's
less pulling them back in than there used

00:13:08.919 --> 00:13:12.236
to be. Moving back home used to come
with a kind of unspoken social pressure.

00:13:12.319 --> 00:13:15.636
You were expected to get on with it,
get out, become financially independent.

00:13:15.719 --> 00:13:18.373
But that pressure has largely
gone now, and on the other side,

00:13:18.456 --> 00:13:20.027
you're not going to be able to do it.

00:13:20.110 --> 00:13:23.225
Honestly, given everything we've
just described, that's probably fine.

00:13:23.308 --> 00:13:27.017
But it does mean that one of the informal
mechanisms that kept people in the labour

00:13:27.100 --> 00:13:30.197
market, even when conditions were
rough, has largely disappeared.

00:13:30.280 --> 00:13:33.320
Now all of this has a price
tag and it's not a small one.

00:13:33.460 --> 00:13:37.602
Eurofound puts the cost of NEATS
to European economies at 142 billion euros

00:13:37.686 --> 00:13:39.969
a year, distributed across foregone taxes,

00:13:40.052 --> 00:13:43.937
lost productivity and benefits paid
out to people who aren't working.

00:13:44.020 --> 00:13:48.062
Now, if you want to see what happens when
a country ignores all of this long enough,

00:13:48.145 --> 00:13:50.057
Japan is probably the clearest example.

00:13:50.140 --> 00:13:53.190
Japan's economy has had a difficult
few decades, to put it mildly.

00:13:53.273 --> 00:13:56.940
The asset price bubble burst in the early
1990s and stable jobs dried up almost

00:13:57.024 --> 00:14:00.785
overnight. Japanese employers had always
hired fresh graduates in a single annual

00:14:00.869 --> 00:14:04.441
cohort and now graduates who expected
to walk into permanent employment found

00:14:04.524 --> 00:14:07.367
themselves cycling through
low-paying part-time work instead.

00:14:07.450 --> 00:14:11.293
The economy narrowed, the entry points
closed and they never really reopened.

00:14:11.376 --> 00:14:15.423
One in four Japanese people in their 20s
will be NEAT at least once over any four

00:14:15.506 --> 00:14:19.196
year period. More than half of them
experience NEAT status multiple times.

00:14:19.279 --> 00:14:22.510
And even in a society with enormous
stigma around falling behind,

00:14:22.593 --> 00:14:25.161
some young people gave up
on getting back into work.

00:14:25.245 --> 00:14:29.291
And then they gave up on going outside.
It got bad enough that they had to invent

00:14:29.375 --> 00:14:32.758
a word for it, hikikomori, which
refers to people, mostly young men,

00:14:32.842 --> 00:14:35.850
who don't go to work or school
and barely leave their room.

00:14:37.450 --> 00:14:42.168
And as surprising as that sounds,
this is the reality for 1.5 million people

00:14:42.252 --> 00:14:45.790
in Japan right now.
That's 2% of everyone aged 15 to 39.

00:14:45.880 --> 00:14:49.314
The average time people spend like
this is around 10 years. 10 years.

00:14:49.397 --> 00:14:52.474
That's not a bad patch or a rough
few months. That's a decade,

00:14:52.557 --> 00:14:56.602
largely alone. Japan didn't set out to
build a society where a million and a half

00:14:56.685 --> 00:15:00.578
people disappeared into their bedrooms.
It just built an intensely competitive

00:15:00.661 --> 00:15:03.483
education system, an economy
with narrowing entry points,

00:15:03.566 --> 00:15:07.255
and a welfare system that relied
heavily on families to absorb the strain.

00:15:07.338 --> 00:15:11.332
Once families reached their limit, there
was little left to catch people falling

00:15:11.415 --> 00:15:12.249
out of society.

00:15:15.880 --> 00:15:19.095
in South Korea, the US, Singapore
and much of the developed world.

00:15:19.178 --> 00:15:23.142
But Japan is where the problem has been
running the longest and gone the deepest.

00:15:23.226 --> 00:15:27.190
There's even a name for what happens when
it's left unaddressed for a generation,

00:15:27.273 --> 00:15:31.287
the 80/50 problem. Parents in their 80s
still supporting children in their 50s who

00:15:31.371 --> 00:15:32.597
never re-entered society.

00:15:32.680 --> 00:15:35.380
That's two people who should
be contributing to an economy,

00:15:35.464 --> 00:15:37.504
one through spending
and one through working,

00:15:37.587 --> 00:15:40.759
both effectively removed from it.
And when those elderly parents die,

00:15:40.843 --> 00:15:44.204
many of their children have no income,
no work history and nowhere to go.

00:15:44.287 --> 00:15:47.931
So a million and a half people in their
bedrooms and parents in their 80s still

00:15:48.015 --> 00:15:51.517
paying the bills is what it looks like
when this problem is left unaddressed

00:15:51.600 --> 00:15:52.727
for an entire generation.

00:15:52.810 --> 00:15:56.536
And look, it would be easy to stop there
and leave you feeling terrible about

00:15:56.619 --> 00:15:59.010
the future. But that's
not quite the full picture,

00:15:59.093 --> 00:16:02.243
because some countries have
actually figured parts of this out.

00:16:02.470 --> 00:16:07.866
Across Europe NEAT rates vary enormously,
from above 22% in Italy and 19% in Greece

00:16:07.949 --> 00:16:10.547
to slightly above 5% in the Netherlands.

00:16:10.630 --> 00:16:13.775
And before anyone says it's
a cultural or attitude thing, it isn't.

00:16:13.858 --> 00:16:16.762
When you look at what the Loenik
countries are actually doing,

00:16:16.845 --> 00:16:20.712
the same answers keep appearing. It all
starts with treating non-university routes

00:16:20.796 --> 00:16:24.278
as a genuine first choice, not a backup
plan for people who didn't make it

00:16:24.361 --> 00:16:27.797
to university, which is how most
wealthy countries currently treat them.

00:16:27.880 --> 00:16:31.949
The countries that do this well run
what's called a dual education system,

00:16:32.032 --> 00:16:36.718
where vocational students split their time
between the classroom and real workplaces,

00:16:36.801 --> 00:16:40.197
so they graduate with work experience,
employer relationships,

00:16:40.280 --> 00:16:43.619
and a foot already. This family
is on the brink of civil war.

00:16:43.703 --> 00:16:48.052
The new season of Mobland is now streaming
on Paramount+. We are the Hardigans!

00:16:48.135 --> 00:16:52.036
Don't know the net? Then Google us!
From the underworld of Guy Ritchie.

00:16:52.119 --> 00:16:54.700
Do you want to step up
the ladder? Here we go.

00:16:57.880 --> 00:17:01.020
Do I have to do everything myself?

00:17:08.350 --> 00:17:12.038
In the Netherlands, 90% of recent
vocational graduates were in employment

00:17:12.121 --> 00:17:16.325
in 2024, well above the EU average. Which
means more young people with a clear path

00:17:16.408 --> 00:17:20.509
forward, which means fewer NEETs, which
means significantly less strain on public

00:17:20.593 --> 00:17:24.435
finances. The other thing the low NEET
countries get right is catching young

00:17:24.518 --> 00:17:28.516
people before they disengage entirely.
Because pulling someone back after years

00:17:28.599 --> 00:17:32.080
out is dramatically harder and more
expensive than not losing them in

00:17:32.164 --> 00:17:32.927
the first place.

00:17:33.010 --> 00:17:36.854
To do that, they make childcare
affordable enough that work actually pays.

00:17:36.937 --> 00:17:39.825
Sweden does this better than
almost anyone. As a result,

00:17:39.909 --> 00:17:44.071
nearly 80% of women are in the workforce
and its NEAT rate of 6.7% is well below

00:17:44.154 --> 00:17:44.927
the EU average.

00:17:45.010 --> 00:17:49.374
Sweden also has housing policies that make
it possible for young people to actually

00:17:49.458 --> 00:17:53.715
live near where the jobs are. And then
there is what Denmark calls "flexicurity".

00:17:53.798 --> 00:17:57.466
Flexible hiring combined with strong
safety nets and active retraining

00:17:57.550 --> 00:18:01.110
programs, so you can lose a job
without it becoming a life sentence.

00:18:01.194 --> 00:18:05.129
The system actively helps you into
the next job rather than just paying you

00:18:05.213 --> 00:18:07.380
to stay home. Denmark's NEAT rate is 6.2%,

00:18:07.463 --> 00:18:11.774
well below the EU's strategic target to
keep the NEAT rate at 9% or below by 2030.

00:18:11.857 --> 00:18:13.090
That's not an accident.

00:18:15.010 --> 00:18:18.145
theory and the numbers make
a pretty compelling case for trying.

00:18:18.228 --> 00:18:21.766
In the UK alone, getting every region's
NEAT rate down to match the best

00:18:21.849 --> 00:18:24.934
performing one would add £26
billion to the economy every year.

00:18:25.017 --> 00:18:28.705
And that's just what you gain. It
doesn't include the money you keep losing

00:18:28.788 --> 00:18:32.175
in welfare payments, health costs
and decades of foregone tax revenue

00:18:32.258 --> 00:18:36.047
from people who stayed out long enough
that re-entry stopped being realistic.

00:18:36.130 --> 00:18:39.587
That bill is considerably harder
to calculate and considerably larger.

00:18:39.670 --> 00:18:43.998
So why has no one fixed it? Partly because
the lazy generation story is a lot easier

00:18:44.082 --> 00:18:47.885
to tell than the structural one,
and it's certainly a lot more politically

00:18:47.968 --> 00:18:51.877
convenient. If you believe that framing
the policy response is motivational,

00:18:51.960 --> 00:18:54.398
lecture the unemployed,
sanction their benefits,

00:18:54.481 --> 00:18:58.547
tell them to lower their expectations.
But if you accept what the data actually

00:18:58.630 --> 00:19:02.118
shows, the response looks completely
different. Structural problems,

00:19:02.202 --> 00:19:04.670
unlike lazy generations,
can actually be fixed.

00:19:09.670 --> 00:19:12.977
political will to do it. And fixing
it matters beyond just the young people

00:19:13.061 --> 00:19:16.458
directly caught up in it. None of us
can look forward to a stable future when

00:19:16.541 --> 00:19:19.397
millions of young people around
the world don't have decent work,

00:19:19.480 --> 00:19:22.335
can't build a life, and are
checking out of the economy entirely.

00:19:22.418 --> 00:19:25.635
These are the people who are supposed
to be driving growth, paying taxes,

00:19:25.718 --> 00:19:27.941
and yes, supporting the rest
of us when we get old.

00:19:28.024 --> 00:19:30.427
Now for the first time since
the industrial revolution,

00:19:30.510 --> 00:19:34.044
younger generations in wealthy countries
are struggling to exceed their parents'

00:19:34.127 --> 00:19:35.867
wealth despite overall economic growth.

00:19:35.950 --> 00:19:40.101
and this is changing our economies. We've
made an entire video unpacking exactly why

00:19:40.185 --> 00:19:43.310
that is. You should be able
to click to it on your screen now.

00:19:43.660 --> 00:19:44.960
Thanks for watching, mate.

00:19:45.100 --> 00:19:45.933
Bye.