Out-of-School and Out-of-Work Youth in Latin America: A Persistent Problem in a Decade of Prosperity

Abstract

This paper explores the persistent shares of youth that are out of school and out of work in Latin America, with special attention to those in the fifteen-to-eighteen age range. According to our calculations, 18.5 percent of Latin American youth in this age group (9.4 million individuals) are currently neither in school nor working. We present the patterns of the evolution of this group in eighteen countries across the region, identifying the set of microeconomic and aggregate variables that are correlated with their dynamics. We explore the relationship with the household’s socioeconomic characteristics and with the structure and evolution of labor markets. We identify the links with the schooling system and school dropout patterns; and we verify whether the group responds to changes in the environment, including overall GDP growth, or to economic shocks. We also explore the possibility that they are simply a transient demographic phenomenon. JEL Classification: J10, J21, I24.