OECD says Italian growth timid, youth unemployment 42%

(ANSA) - Rome, July 9 - The OECD said that Italy is set to enjoy only timid growth after years of recession and depicted difficult labour market conditions, especially for young people, in a report released on Thursday.
    "The Italian recovery will remain timid for some time," the OECD said in its employment outlook.
    "According to the most recent OECD projections, Italy's real GDP growth will be 0.6% in 2015 and 1.5% in 2016, both below the expected growth for the Euro Area and the OECD as a whole".
    It noted that Italy's unemployment rate has started to decrease from the 13% peak reached in November 2014, dropping to to 12.4% in May while stressing that this was still 1.3 percentage points above the eurozone average.
    The situation is particularly bad for young people, it said.
    The OECD said that Italy's youth unemployment rate for 2014 was 42.7%, up 2.7 percentage points on 2013 and more than double the rate of 20.4% in 2007. It added that more than one in four people under 29 in Italy are neither in employment nor in education or training (NEET). "The NEET rate has soared by 40% since the onset of the crisis, opening a wide gap with the OECD average," it said.
    The Paris-based organization said that Italian workers who start a career on a temporary contract find it particularly difficult to obtain a permanent job on a stable basis. "Only 55% of the typical labour market entrants who start with a temporary job are on a permanent contract 10 years later in Italy, one of the lowest figures within the OECD," the outlook read. It said the percentage of under-25 workers employed on atypical contracts in 2014 was 56% up from 52.7% in 2013, from 42.2% in 2007 and from 26.6% in 2000. The outlook also said that Italy's proportion of long-term unemployed - the share of those who have been searching for a job for more than one year - among the jobless was among the highest within the OECD at 61.1%.
    But the OECD did see identify positive areas too, hailing Italian Premier Matteo Renzi's Jobs Act labour reform. Among other things, the reform weakens the laws on unfair dismissal in a bid to encourage firms to hire people on permanent contracts, giving new employees gradually rising levels of worker protection.
    "The Jobs Act - by increasing incentives for the creation of open-ended jobs under the new contract with a gradual increase in protection, and extending the coverage of out-of-work benefits - represents an important step forward towards the reduction of long-term inequality and the elimination of segmentation," the OECD said.