Youth Unemployment in Australia

Patrick Carvalho
22 November 2015 | Research Report 7
Youth Unemployment in Australia

This report looks at quantifying the rising youth unemployment problem, understanding its causes and proposing policy solutions.

Youth employment has progressively taken a hit after the Global Financial Crisis, practically doubling since mid-2008. At an average rate of 13.5% in the past 12 months, the jobless rate among those aged 15–24 has reached worrying levels once thought to be left behind in a distant past. Currently, there are around 300,000 youth unemployed in Australia, accounting for over a third of total unemployment.

There are four main recommendation areas to reverse the rising youth jobless figures. First, Australia must implement structural reforms to lift economic growth to combat the recent surge in youth unemployment (particularly tax reform, reducing barriers to competitive markets and adopting a job-creation oriented workplace relations strategy). Second, Australia needs to deregulate its workplace counterproductive requirements on pay floors, by allowing local discounts on minimum wages and industry-specific award rates to take into account diverse cost of living across Australia, coupled with fixed-period discounts for those who are long term unemployed. Third, Australia needs to combat welfare dependence and deliver effective welfare assistance by adopting an actuarial long-term management of the welfare system. Last, Australia should lift numeracy and reading skills of school-leavers to improve employability as well as investigate innovative ways to increase the accountability of tertiary and VET institutions with respect to job market outcomes.

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