Why are young people unemployed while tech vacancies are plentiful?

Vocational education curricula are disconnected from the tech market’s demands, especially with regard to teaching methodologies that encourage students to solve real-world problems.

“Brazil’s technology sector has been growing among the fastest in the world. The country’s human capital training, however, is growing in the opposite direction.”

Read more in Luiza Toledo and Talita Nascimento’s essay.

Brazil’s technology sector has been growing among the fastest in the world. The global software market, for example, generated US$ 1.3 trillion in 2020. Brazil alone was responsible for US$ 22.9 billion, occupying the 9th position in the world rank and leadership in Latin America - according to the Brazilian Association of Software Companies (ABES) 2021 report. The country’s human capital training, however, is growing in the opposite direction.

Tech companies require around 159,000 new professionals per year, yet less than 50 thousand young IT professionals are trained by higher education institutions each year. That amounts to an annual deficit of 106,000 talents, according to Brasscom’s projection. In addition, there’s a universe of over 3 million unemployed young people, in which low-income youth still face restricted access to university, with few showing interest in technology, as shown by the OECD.

A diagnosis explaining this imbalance between supply and demand for technology professionals and why this problem persists over time was produced by Telles Foundation (a nonprofit organization focused on ensuring opportunities for low-income youth) in partnership with Delivery Associates (a global public management consultancy).

Through in-depth interviews with more than 30 specialists in the field (educators, entrepreneurs, and public managers), public data analysis, and mapping of 34 international and national success cases, the research team identified six main problem drivers and potential solutions.

The study reveals a chronic deficiency in key-competences training to the development of technology activities, such as mathematics, English, and logical thinking. IDEB (the Brazilian Index of Development of Basic Education) data show that, in 2019, only 5.2% of high school students graduated with adequate Math learning. Even private schools have difficulty delivering quality math education; only 39% of high school graduates show appropriate learning. English proficiency is also a challenge for potential tech workers, a crucial skill in understanding basic programming commands. In Brazil, only 10,3% of 18-24 year-olds claim to be proficient in English, according to a British Council report.

For low-income youth, the lack of repertoire, self-esteem, and contact networks is also a challenge to overcome in order to enter the tech market. Most public school students are unaware of the professional and financial opportunities within the sector and are directly influenced by their closest family members when it comes to defining their careers.

Furthermore, there’s a consensus among specialists that current vocational education curricula are disconnected from the job market’s demands, especially with regard to active learning methodologies that encourage students to solve real-life problems and ensure hands-on learning experiences. The study shows that the private market increasingly seeks professionals that can combine technical and socioemotional skills. Communication, problem-solving, responsibility, and self-education are fundamental competencies, but they’re still poorly addressed in public schools. An exception in this ecosystem is the full-time high school curriculum, prioritizing youth leadership, life design, and autonomy.

From the professionals’ demand perspective, the study revealed that the demand for junior professionals is low - around 13% -, and geographically restricted. About 41% of the 129,000 vacancies available for IT in 2021 were for positions in the South and Southeast regions. Although the COVID-19 pandemic response has leveraged remote work, recruiters still prefer young professionals who live in the companies’ headquarters city. According to Revelo’s study, only 19% of IT vacancies in 2022 were intended to remote work.

The study also found that certificates are valued when hiring young talents. The interviews showed that the assumption that a university degree is not necessary to work in technology is, in part, a myth. Even though companies don’t include higher education as a prerequisite, in practice, young graduates hold an advantage in hiring. According to interviews with experts, the vast majority of medium and small companies don’t have the robust recruiting structure required to identify skills during the selection process.

As a result, they end up using the certifications as a sign of candidate quality. Large companies are an exception, with in-house training resources to build capacity in technical skills such as programming, language, and coding. In this case, the selection processes prioritize talents with socioemotional skills and alignment with the company’s values.

Investing in a new model of technical education, with a curriculum that combines technology knowledge, socioemotional skills, and effective connection with the job market is not just a way of guaranteeing the IT industry’s growth in Brazil. Most importantly, it is a way of ensuring that low-income young people are prepared to participate in the working world’s future, with the leading role that they deserve.

Luiza Toledo holds a degree in psychology from Mackenzie Presbyterian University and a postgraduate degree in Leadership Development from Fundação Dom Cabral. She worked for more than 10 years in the human resources area, specializing in designing strategies for developing leaders and training young people. She works in the third sector with a focus on education, having worked at Ismart with a focus on the development of gifted young people. She is currently responsible for the Telles Foundation, a philanthropic organization focused on generating opportunities in STEM careers for low-income young Brazilians.

Talita Nascimento holds a master's degree in Educational Policy from Teachers College, Columbia University, and a bachelor's degree in law from the University of São Paulo. Talita has been working with education for over 10 years, having held leadership positions in the Ministry of Education, Unesco, Fundação Getulio Vargas, and in the third sector. She is currently a project leader at Delivery Associates, a global public policy consultancy.