Make way for the young: strategies to reduce youth unemployment in BRICS+ countries.

Preamble:

I would like to start with the evident fact that the 21^st century represents breaking of paradigms in all their manifestations, starting fr om reverse processes in the area of international cooperation (Globalism - Regionalism) to form solid, first of all, economic unions, as well as social changes in public understanding.

BRICS+, as an alternative to the established Western type of unions, such as the European Union, seems to be a necessary form of cooperation for countries that do not wish, for one reason or another, to be dependent on the influence of those trends that are established by the Western World. Not at all, the issue of sovereignty of a particular country can be consolidated through strengthening of states in an economic block the goal of which is, if not an immediate, but a promising and elaborated task for generations to come: investments in the economy of own countries, and, thus, investments in own human potential.

Relevance of this essay results from the attempt to solve the question faced by BRICS+ partner countries: how to reduce the level of unemployment among the population of countries, in particular the youth, via joint projects and exchange of their human resources within the framework of strengthening of the partner countries' economies?

Involvement of the more active part of the world's population, namely the youth, in the work process is traditionally considered to be the predominant factor of human potential development.

In general, population growth in the top five BRICS+ countries demonstrates the necessary positive growth, except for Russia and China, wh ere gradual decline in population will be observed. For example, according to the leading Statista portal, in 2025 rather sharp decrease is expected in population of Russia fr om 146.08 million in 2024 down to 143.71 million by 2029. More gradual reduction is forecasted for PRC: 1409.05 million in 2024 down to 1401.43 million by 2029. This negative growth is described by aging of the population in these countries and, as a result, stagnation and possible regression in the process of recruitment of their own labor force, the basis of which has always been the young population. One should not forget about the special regulation of demography in the People's Republic of China and strict observation of this law.

The other three countries (India, Brazil, South Africa) have the opposite trend.

According to forecasts, Indian population will increase from 1441.72 million in 2024 up to 1503.47 million in 2029, Brazil: 212.54 million in 2024 up to 215.92 million in 2029, South Africa: 63.2 in 2024 up to 68.6 in 2029.[1]

To analyse such statistics, it is possible to consider the situation using Russia as an example. Trends of the demographic crisis in the Russian Federation have a model similar to that of Western European countries with aging population and low growth. As a result of the minimal birth rate in the past and in the present, workforce aging is accelerating correspondingly, as scanty generation of the 1990-s and 2000-s is entering working age while raising of the retirement age extends working life of the older generations.[2] Taking into account data of the World Bank, in such case increase by 1% in the share of the working age population filtered by migration factor would mean increase in per capita GDP by 1.6%. According to experts of the Central Bank, based on the data of the World Bank, aging of Russian population could come at the cost of slowing down of the economic growth in the amount of up to 1–1.5% GDP a year.[3]

Thus, job taking by the younger generation is a problematic issue, as staff employment often requires relevant industry experience, which cannot be provided by young experts, who are just starting their careers.

Experts of the Institute of Economic Forecasting of the Russian Academy of Sciences (IEF RAS) inform that labor shortage in the 25 years period has reached its peak: in late 2023, 61% of enterprises reported staff shortage.[4] By April 2024, official unemployment rate, according to Rosstat, reached new historical minimum of 2.7%. Staff shortage reveals problems in almost all areas of the economy.[5]

What should our country do in such a situation and how to attract the potential of BRICS partners to solve such problem? There is an answer: digitalization, optimization, salary increase, and attraction of foreign personnel.

That's exactly it. At first, such point of view may sound utopian, but behind it there is a real prospect of emerging from the situation of intense unemployment with increased flow of investments and profits for all parties involved.

Modernization and digitalization of the economy can attract to the labor market more of young population, among which the unemployment rate is twice as high as the average. Considering data jointly presented by SRG and Russian Presidential Academy of National Economy and Public Administration in early 2024, 60% of young people put technical infrastructure and safety first in their requirements for workplace.[6]

As an example, it is possible to consider cases of South Korea and Japan, wh ere demographic growth of the population is actually reduced to zero and migration process in these countries is minimal. However, economies of the two countries are leading in the region and the world, which is demonstrated by the positive process of digitalization and optimization from the very point of view of the economy.[7]

Another example are Persian Gulf countries. First of all, UAE. Investments in tourism, services, and urban infrastructure of the state create attractiveness for business and residence of all potential workers.[8]

Now, what strategy can be implemented for BRICS countries, in particular Russia? The author of this essay suggests several stages for its implementation:

1-      Introduction at the state level of a list of in-demand professions in various sectors, employment in which will be guaranteed already during studies (these can be institutions of both vocational secondary and higher education).

2-      Provision of young professionals with mentors from among senior colleagues for adaptation at the initial stage of their professional career.

3-      In the industries, in which the government of particular country was unable to provide its industries with sufficient amount of staff, to accept in this capacity people from BRICS member countries with growing population, as in their countries there will be difficulties with employment due to increased population.

4-      To implement the third point it is necessary to elaborate together with the participants of the union a single stage of staff certification, which will allow priority consideration of labor force from BRICS+ member countries.

5-      Digitalization of the economic sector.

6-      Provision of social guarantees for young employees.

7-      Optimization of vocational professions according to the requirements of technical progress.

8-      Proper retraining of employees, whose jobs will be subject to the digitalization and optimization.

Such measures can improve production potential of each country and bring profit to each country at different positions based on the employer-employee model. Digitalization enables flexible business models, optimization is a stage of production process automation, and long term contracts and preferential terms for the expanding number of BRICS+ countries open access to logistics optimization, which causes reduction in cost price, as well as increase in profits and profitability. Unified certification system of the union countries will enable such high standard of employee professional suitability testing that is suitable for both developed and developing economies.

Thus, the issue of youth unemployment may fade into the background, if mechanisms are already active at the stage of profession choosing by young person, as the government will be able to point out those areas that are necessary for the country and its economic allies. Management of the unemployment problem with such strategy makes it possible to return 1.5% GDP each year.

Having examined the issue of youth unemployment in the BRICS+ countries in detail, it is possible to conclude that development of a common mechanism among the union countries is yet to come. It is primarily important to have a common staff certification system to ensure quick access to labor force of the member countries. This will enable faster response to market demands, as well as participation both in internal projects and projects between the union countries.

^[1] Total population of the BRICS countries from 2000 to 2029 // Statista: web-site. – URL: https://www.statista.com/statistics/254205/total-population-of-the-bric-countries/ (date of access: 24.02.2025)

^[2] Experts estimated decrease in labor force in Russia by the end of the decade Population aging could cost the economy 1–1.5% GDP a year // RBC: web-site. – URL: https://www.rbc.ru/economics/01/06/2022/6294c6b89a7947c8beb41030?ysclid=m7iqgvu6md751925227 (date of access: 24.02.2025)

[3] Population aging and its impact on economic development // ECONS: web-site. – URL: https://econs.online/articles/ekonomika/starenie-naseleniya/ (date of access: 26.02.2025)

^[4] Staff shortage increased discrimination // Kommersant: web-site. – URL: https://www.kommersant.ru/doc/6085018 (date of access: 24.02.2025)

^[5] What will help the country's economy to overcome shortage of skilled workers // RBC: web-site. – URL: https://www.rbc.ru/industries/news/6671444f9a7947966ad151d4?ysclid=m7iqj19x9s148110087 (date of access: 24.02.2025)

^[6] SRG partner provided innovative IT-solution for human resource management // SRG: web-site. – URL: https://srg-eco.ru/news/partner-srg-predstavil-innovacionnoe-it-reshenie-dlya-upravleniya-kadrovymi-... (date of access: 24.02.2025)

^[7] The economic miracle and demographic pit of South Korea // TASS: web-site. – URL: https://tass.ru/opinions/16868761?ysclid=m7itk5vxp9916804059 (date of access: 24.02.2025)

^[8] United Arab Emirates (UAE): labor force // The Global Economy: web-site. – URL: https://ru.theglobaleconomy.com/United-Arab-Emirates/labor_force/ (date of access: 24.02.2025)