Jobless Youths and the NEET Problem in Japan

TLDR: In this article, the determinants of non-employed young Japanese people, whose number increased from the 1990s to the beginning of the 2000s, were examined empirically and it was shown that young persons whose expected returns from working are low, such as females, older people, the less educated and the long-term jobless, tend to refrain from working.

Abstract: This paper empirically examines the determinants of non-employed young Japanese people, whose number increased from the 1990s to the beginning of the 2000s. Non-working unmarried persons aged 15–34, who do not attend school, are classified into three types: ‘job seekers’ (type 1), who search for jobs; ‘non-job seekers’ (type 2), who express a desire to work but do not search for jobs, and ‘non-job seekers’ (type 3), who express no desire to work. Those in type 2 and type 3, non-job seekers, are defined to be ‘NEET’ or ‘not in employment, education or training’. Multinomial logistic regression results show that young persons whose expected returns from working are low—such as females, older people, the less educated and the long-term jobless—tend to refrain from working and become non-job seekers. Moreover, there is evidence of an income effect that makes youths from wealthy families more likely to be type 3 non-job seekers. However, the number of jobless youths from lower-income households has been increasing and hence, the income effect on type 3 jobless has become less relevant recently. As a result, young, less-educated males from poor families in Japan have become more likely to lose interest in work rather than those in middle-income families.