Immigration collapse saves young Aussies from mass unemployment

Yesterday’s employment report from the Australian Bureau of Statistics (ABS) revealed that Australia’s youth – defined as those aged 16 to 24 – continue to benefit immensely from the closure of Australia’s international border to immigration.

While overall youth employment is still yet to return to its pre-COVID level, with total jobs still down 9,700 from their pre-COVID peak and full-time jobs down 41,900:

Youth employment

Youth employment yet to recover from pre-COVID level.

The youth unemployment rate was only 10.2% in July, which was close to the lowest rate of unemployment since January 2009:

Youth unemployment

Lowest since January 2009.

This comes despite the youth participation rate running 1.2% above its March 2020 pre-COVID level:

Youth participation

Youth participation booming.

The youth underemployment rate is also running 1.2% below its pre-COVID level, despite rising in July:

Youth underemployment

Also down but more work to do.

The reason why the unemployment rate has fallen despite annual job losses and rising participation is because the youth population fell by 131,800 (4.1%) in the 16 months since COVID hit in March 2020:

Youth population

Big fall in youth population.

The reason for this sharp fall in youth population is that around 500,000 temporary migrants have left Australia – most of these international students:

Temporary visa holders

Big fall in temporary visa holders.

These temporary visa holders tend to work in low skilled industries like hospitality that employ young Australians:

Temporary migrants

Migrants compete with young Aussies for jobs.

As noted by RBA economists:

The largest growth in migration by far has been for unskilled migrants, primarily students, working holiday makers and family visa holders. These migrants have partial or full work rights and tend to work in the lowest paid jobs, for which domestic labour is relatively easily substitutable.

The above data is bonafide proof that the collapse in immigration is benefiting Australia’s youth. The reduction in young migrant workers has more than offset the loss of youth jobs, resulting in better employment opportunities for Australia’s youth.

Put another way, Australia’s youth would be experiencing mass unemployment if immigration had continued at its manic pre-COVID rate.

Unconventional Economist

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