Youth Employment Minister Angela Constance has singled out £8.5 million which she says will create 1,000 jobs and 800 voluntary opportunities for young people.
The second tranche of funding from the £30 million youth employment package announced in December will fund the continuation of the employment partnership Community Jobs Scotland into 2012-13, creating the jobs for young people at a cost of £6 million.
Announcing the funding in Parliament, Ms Constance said: "Community Jobs Scotland draws and improves on similar schemes such as the Future Jobs Fund by providing employability training for participants. Although the scheme has only been running since August it has already had a life-changing impact on a number of participants."
Ms Constance also said £2.5 million will go to a "challenge fund" to help the voluntary sector work with employers, which she said would create 800 opportunities for young people.
She added: "Organisations will be invited to submit proposals for 2012-13 in the weeks ahead. The key criteria of this fund will be a demonstrable track record of success, strong links with employers and innovative approaches not replicated elsewhere in the system."
However, Labour youth employment spokeswoman Kezia Dugdale said the youth unemployment strategy does not go far enough.
She said: "If the minister has a social conscience, then she should apply it by setting out to eradicate youth unemployment. Be that bold. Seek to tackle inequality at the heart of the system."
Ms Constance asked Ms Dugdale what she would do to achieve full employment under the powers of a devolved parliament. Ms Dugdale said: "I think it's very sad that the ministers' ambitions don't reach that far with the powers that she has."
Conservative MSP Liz Smith said her party welcomed announcement. However, she said funding for colleges remain a concern, in relation to youth unemployment.
"Like John Spencer, the convener of Scotland's Colleges, we remain in absolutely no doubt about the significant challenges which remain in the college sector as a result of the disproportionate cuts."
