Europe looks to training to fight youth unemployment
* EU leaders set aside 6 bln euros to tackle youth unemployment
* Aim is to give training and apprenticeships to school leavers
* Europe above all needs growth to kickstart hiring
* Fears that a generation will be lost and unrest will grow
BRUSSELS, June 25 (Reuters) - European leaders will use a summit this week to examine how to use billions of euros to fight soaring youth unemployment, though economists say the sum is a fraction of what is needed to prevent the EU's young people becoming a lost generation.
Leaders agreed in April to set aside 6 billion euros from their long-term budget, which runs from 2014-2020, to combat youth joblessness, with more than half of under-25s in Greece, Spain and some other regions out of work.
The fear is that, without a solution, an entire generation of young people - one of the best-educated Europe has produced - will be sucked into a quagmire of unemployment or underemployment, with long-term social and economic consequences.
"It is not a good time to be a young person looking for a job," said Theodore Sparreboom, a senior economist with the International Labour Organization (ILO) in Geneva. "And prospects do not look like they are getting better."
The EU's idea, to be discussed at a summit on June 27-28, is to use the 6 billion euros to offer a "guarantee" of a job, training or apprenticeship within four months of someone becoming unemployed or leaving formal education - a safety net for the 5.6 million young people who are unemployed.
But it's a goal that is likely to exceed the available budget.
"Six billion euros over seven years and for 28 countries is too small - even if the youth unemployment problem is not that pressing in some countries like Germany," said Zsolt Darvas, a policy expert at Bruegel, a Brussels think-tank.
The ILO, a U.N. body responsible for promoting work and employee rights, estimates that the EU would need around 21 billion euros over the same period to make a real dent in the average youth unemployment rate of 23 percent.
EU diplomats acknowledge that 6 billion is a symbolic figure. Mostly, Europe needs to be seen to be confronting the problem, even if throwing money at it will not necessarily make it go away more quickly. The key is growth, something the region has lacked for most of the past four years.
"It's not possible to create jobs in a recessionary environment - you need growth to pick up," said Carsten Brzeski, an economist at ING in Brussels.
LOOKING TO AUSTRIA
Analysts agree that unless a Europe currently in recession can achieve real growth of 1.5-2.0 percent, it will struggle to bring average unemployment down from its record 11 percent.
For now, EU leaders hope a programme of training and apprenticeships, using a model that has worked in Austria, will provide a bridge to a time when growth has picked up.
Austria has the lowest unemployment in the EU at less than 5 percent, as calculated by the EU statistics agency, Eurostat, and has long used mentoring and training as a way to get young school leavers and graduates into jobs. By part-subsidising the employment or skills training, the government gives employers the confidence to hire.
A similar programme has worked well in Germany, where companies help to write school syllabuses and have been given incentives to offer young people one-year learning contracts that help them move into full-time jobs.
"There are many tools that can help, such as various training programmes, internships, tax breaks for hiring the unemployed," said Darvas of Bruegel. "Yet it is economic growth that can really help address the crisis."
The need is most urgent in Greece and Spain, where youth unemployment is over 50 percent, as well as parts of Italy, Portugal and some northern EU countries.
Eurofound, an EU agency devoted to improving work conditions, estimates the cost of youth unemployment in Europe at 150 billion euros a year in lost earnings and taxes as well as unemployment benefit and other welfare payments.
But the cost is also social and psychological.
"What is at stake is social unrest and a risk of a lost generation," said Brzeski from ING. "A generation that was supposed to embrace the idea of Europe, but is now turning its back on it."
(Reporting by Martin Santa; editing by Luke Baker and Kevin Liffey)