The measure is in line with the Europe 2020 strategy and in particular with the flagship initiatives “Youth on the Move” and “An agenda for new skills and new jobs”. Hence aims to reduce youth unemployment by simplifying the transition from education to work in line with the wider EU target of achieving a 75% employment rate for the working-age population (20-64 years).

It is also in line with the Employment Guidelines and with several EU instruments such as the ESF implemented under the priority to improve ‘access to employment’ for young people. The measure has been co-financed by the ESF (as of 2009, ESF and IEFP co-fund the programme by 70% and 30% respectively).

The Portuguese labour market is characterized by a predominantly low skills base. In 2008, almost 70% of employed Portuguese individuals held no more than lower secondary education. In the EU, the average was 23.6%. Although the 70% represents an improvement from 1997 (75%), the employed Portuguese population is still predominantly under-qualified.

Unemployment rates have also risen from 3.3 % in 2000 to 8.3% in 2011 for those with a tertiary education. This is well above the rates for EU (5.5% in 2010). Youth unemployment rates have increased from 8.2% in 2000 up to 22.4% in 2010 and above the EU average (20.8 %). Available data for the first quarter of 2011 showed another considerable increase up to 27.4%.

The measure is intended to go hand in hand with a reformed economic strategy emphasising the development of higher skilled, higher added value sectors. Indeed, in Portugal low qualified individuals can often find employment more easily than those with higher levels of qualification and therefore do not require the same levels of support in terms of their transition into employment.

The measure aimed to ensure the integration of young people into the labour market, designed to address Portugal’s perennial problems with a generally low skills base in the labour force. Overall the objective was to enhance the employability of young people but also business innovation.

The policy measure supports the transition between the education system and the labour market, promoting the improvement of qualifications and the adaptation of the Portuguese economy to the challenges of a global economy. It seeks to: complement and improve the skills of the unemployed in order to facilitate their recruitment and integration into the labour market; and raise awareness among enterprises (particularly SME’s) of new qualifications and competences available, and to promote employment in new areas.

The measure is focused on the integration of highly qualified young people into the labour market by complementing their basic pre-existing qualifications with practical on-the-job experience in a company for a maximum period of 12 months. The traineeships allow young people to get a first contact with the labour market and, at the same time, help companies, particularly SMEs, increase their awareness of new knowledge and competences.

• Targeted: unemployed young people looking for first/new job and aged up to 35 years (as of start date of traineeship) and who hold one of the following diplomas: upper secondary level, post-secondary level, or higher degree level. Enterprises are also beneficiaries: highly qualified young people integrated into workforce at lower cost/reduced risk conditions.
• The measure provided a monthly subsidy of EUR 691.71 to the graduate plus a monthly subsistence allowance of EUR 85.40. A total graduate subsidy of EUR 777.11/month (in 2011).
• Enterprises contributed to grants for trainees, according to legal status/size: Private & < 10 workers or non-profit: 75%; Private & profit & 10-250 workers: 65%; Private & profit & > 250 workers: 40%.
• Enterprises that wish to support trainees must register with national online system (known as NETEMPREGO). Companies are responsible for: the technical and pedagogical supervision of trainees, following up progress towards the Traineeship Individual Plan objectives; and, assessment of results obtained by trainees using a “Trainee Follow-up and Evaluation Report”.

The Professional traineeship programme will be replaced by a new measure called Employment Traineeships (Estágios Emprego) which will target both young people and adults, at different educational level. Within the new measure the grants will be assigned according to the level of education.

The programme led to an increase in the number of traineeships, high transition rates into employment, incorporation of highly qualified staff in the labour market, encouraging investment in career development and improving productivity and competitiveness.

Results of the evaluations were:

• Between 1997 and 2011 over 170,000 young unemployed individuals have benefitted from the measure.
• Transition rates from the traineeship programme to employment have been consistently high (over 70%), with many young people staying in employment with the same company; transition rate represented 25% of the total annual inflow of highly qualified people into the employed population.
• Company benefits: incorporation of highly qualified staff at reduced costs; helping fill the gap between universities and companies, generating a change in staffing cultures, encouraging investment in career development and improving productivity and competitiveness.
• Trainee benefits: improved employability; smoother transition between academic environment and professional life.