Youth labour market smashed by lockdowns

Yesterday’s employment report from the Australian Bureau of Statistics (ABS) revealed that Australia’s youth – defined as those aged 16 to 24 – have been hit hard by lockdowns.

Total youth jobs fell 75,400 in August, driven by an 80,000 reduction in part-time jobs, partly offset by a 4,500 increase in full-time jobs.

Accordingly, youth jobs are down 81,400 from their pre-COVID peak with full-time jobs down 34,000 and part-time jobs down 47,400:

Youth jobs

Youth jobs well down from pre-COVID level.

The youth unemployment rate rose 0.5% to 10.7% in August, but remained 0.9% lower than its pre-COVID level of 11.6%:

Youth unemployment rate

Youth unemployment rebounds.

The youth participation rate fell 2.5% in August to 67.0% and was running 1.3% below its pre-COVID level:

Youth participation rate

Youth participation down.

On the plus side, the youth underemployment rate fell 0.8% in August to 16.6% and is running 1.9% below its pre-COVID level:

Youth underemployment

Below pre-COVID level.

Australia’s youth would be in a far worse employment position had their population not fallen by 133,700 (4.2%) in the 17 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 level.

Unconventional Economist

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