World and Nation

European leaders grapple with youth unemployment

FRANKFURT, Germany — Record youth unemployment is emerging as the most urgent problem in the eurozone, if the political rhetoric of recent days is any measure. But leaders are struggling to come up with effective ways to prevent jobless young people in countries like Spain and Greece from becoming a lost generation and source of social upheaval.

One proposal, floated in a German news report Monday, would use a development bank owned by the European Union to funnel credit to companies that create jobs for young people in the eurozone, nearly a quarter of whom are without jobs.

Officials in Berlin quickly played down the report published in the online version of the Rheinische Post newspaper, based in Duesseldorf. But it is clear that policymakers are seriously worried that millions of frustrated young job seekers pose as much of a threat to the eurozone as excessive government debt or weak banks.

The issue is likely to come up when finance and economy ministers of the 17 eurozone countries meet Tuesday in Brussels.

Angela Merkel, the German chancellor, considers youth unemployment to be Europe’s biggest challenge, her spokesman said Monday.

“The issue is on the agenda of every European meeting, whether at the ministerial level or among leaders,” Steffen Seibert, Merkel’s spokesman, said in Berlin.

Seibert’s comments came a few days after Wolfgang Schauble, the German finance minister, warned that youth joblessness could undermine faith in European institutions.

“We will have to speed up in fighting youth unemployment, because otherwise we will lose the support, in a democratic way, in some populations of the European Union,” Schauble said, shortly before meeting with his counterparts from the United States and other Group of 7 countries last weekend.

And Louis Gallois, former head of European Aeronautic Defence & Space and the French government’s commissioner for investment, told a gathering at the German Finance Ministry in Berlin that more investment should be directed toward getting people back to work, if the European project was to succeed.

“Support to Europe is more and more limited because Europe is seen more and more by European citizens only as a constraint,” Gallois said.