More young people in education could boost Irish GDP by €10bn

Ireland’s gross domestic product (GDP), a measure of our economic activity, could get a €10 billion boost if more young people were in education, employment or training, a report has said.

The young workers index from professional services firm PwC suggests that a boost of about 3.6 per cent over the long term could come if our number of young people not in education, employment or training dropped to the same level as Germany.

Germany, Switzerland and Iceland score the highest in PwC's index, with Ireland coming in 26th place with an index score of 42.5. To put that in context, the OECD average score is 49.2, while Germany scored 68.9.

“The key reason for the relatively lower score is due to Ireland’s relatively high proportion of young workers not in education, employment or training, though that has improved since 2011.

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“As a nation, and in the light of many businesses experiencing skills challenges, Ireland has some work to do to ensure our young people are equipped with the skills needed for a digital world including providing the right training and education,” said Gerard McDonough, a director in PwC Ireland.

As a result of the expected wave of automation through technologies such as artificial intelligence, less educated young people "could face major challenges", PwC chief economist John Hawksworth warned.

As to how Ireland could improve its ranking, Mr Hawksworth noted that "countries with strong STEM [science, technology, engineering and mathematics] skills, such as Japan, also perform relatively well in our index and could move further ahead as technological advances put a greater premium on these kinds of skills".