Business Spectator’s Callum Pickering has written another good article today on a particularly important issue: Australia’s growing youth unemployment:
Australian society is failing its youth and setting itself up for economic disaster. The persistent rise in youth unemployment will reverberate across the economy for decades to come, potentially reducing productivity and limiting creativity and innovation…
The unemployment rate for 15 to 24 year olds has increased significantly since 2008, rising to around 12.5 per cent in February… Since 2008 the participation rate has declined by over 5 percentage points and it’s now at its lowest level since the series began in 1978. The rapid and sustained decline in youth participation since the global financial crisis is larger than during the early 1990s recession.
…the decline is more likely to reflect young Australians becoming discouraged by rejection or limited opportunities and giving up on finding a job. This is first and foremost a failure of Australian industry and the labour market itself rather than something specific to young Australians…
With the labour market for young Australians continuing to deteriorate, Australia is creating a generation of youth who will be less skilled and experienced than the generation that precedes it.
While spin doctors used last week’s better than expected jobs numbers to declare that unemployment had bottomed, Australia’s youth unemployment rate has tripled since the Global Financial Crisis to 12.5%, causing 257,000 young Aussies between 15 to 24 years of age to be jobless. Of this number, 50,000 have been unemployed for more than 12 months, with the average length of time taken to gain a job rising to 29 weeks from only 16 weeks in 2008.
The below charts, from the Brotherhood of St Laurence’s latest report, On the Treadmill: Youth & Long-Term Unemployment in Australia, highlights dire the situation more clearly:
All of which makes Prime Minister Tony Abbott’s statement last night to employers that Australia’s youth needs old-fashioned tough love to help solve the youth-unemployment crisis, sound particularly hollow.
