The impact of COVID-19 on Australia’s labour market is starting to sink in.
It is fast becoming the next big challenge for government, business and community. Getting people back to work quickly and safely will soon be
the new urgency — not so much on avoiding the virus itself.
Young South Australians who have recently left school, who will be leaving school later this year, or who commenced tertiary studies earlier this year, find themselves in a world very different from anything most of us have previously experienced or know. And we can be sure that this changed economic and social environment will have an unequal and negative impact on young people too.
Why? Because this is exactly what has happened over the past two decades. Unemployed and underemployed young people between the ages of 15 and 24 have borne the brunt of changing structural issues within our economy, both before 2020 and after the GFC. They are likely to do so again unless, this time, this age-group gets a specialist response.
A specialist response means acknowledging there are very few clear pathways to sustained employment for young people right now. The New Work Reality report published annually by the Foundation for Young Australians, which has followed the journeys of 14,000 young people over the last decade, has found that approximately half of Australia’s 25-year-olds are unable to secure full-time employment despite 60% holding post-school qualifications.
The long term economic and social impact of this situation is huge. ABS estimates suggest the failure to create jobs for this age-group equates to $15.9 billion in lost GDP to the Australian economy annually, with the accompanying loss of confidence, hope and self-esteem impacting on mental health services that will cost an additional $7 billion per annum.
The data is clear. The impact of restructures introduced into labour markets since the 2000s has done nothing to stop youth unemployment rates reaching levels three times higher than those experienced by Australians who joined the workforce prior to this time. If we continue to allow this situation to be ‘the norm’ we will create several more generations of young people who have little or no work experience, little or no continuous income, and little or no hope for the kind of future they, or their parents and grandparents imagined.
According to the Brotherhood of St Lawrence’s (2019) annual report on youth unemployment, South Australia’s Barossa, York and Mid North regions, including Port Pirie, have consistently been amongst the highest youth unemployment ‘hotspots’ in Australia.
As we now face an even more difficult economic period, following widespread job loss, labour market displacement, and major disruption in the hospitality, retail, tourism and transport industries, young people in these areas are expected to experience even greater depths of unemployment over longer lengths of time — that is, if no adequate response is made.
With many of the industries that traditionally employed young people affected, this next period directly following the shutdown of the economy will be worse, impacting further on youth unemployment and underemployment rates already at unacceptably high levels.
As shocking as the figures are, what underlies them is an even harsher reality. Every day, young people struggle to try and make ends meet, to find work, to pay rent, to eat, and to maintain hope for a positive future.
The decline in full and part-time work that has been on the rise since the ’80s continues to trend downwards as more and more full-time positions are replaced by casual and contract work. This prevalence in short-term, insecure work, has knock on effects in other areas of a young person’s life such as limiting their ability to secure any kind of loan for example or build a consistent pattern of savings to help convince a bank to say yes to a mortgage application, let alone capacity to plan for a family. We can be certain the kind of long-term frustration this must cause will take its inevitable toll.
Given the situation before COVID-19, it’s even more likely there will be a drastically changed job market now, as those jobs traditionally that are undertaken by young people are further eroded. As competition for even fewer entry-level jobs grows, it’s likely we’ll see an increase in competition between those with qualifications and those without, between those with experience and those without. Young people will be the long tail of the recession and economic restructuring needed, yet again.
And this impact won’t be felt equally by all young people either. It will be felt most by young people from low-income households already doing it tough.
It will be those living in regional areas, from refugee and migrant backgrounds, early school leavers and young parents, young people from jobless families, those who are welfare dependant, or living with a disability; young people who have mental health issues, chronic illness, caring responsibilities, are homeless or who have limited literacy and numeracy competency who will bear the brunt. These are young people already in need, and for whom targeted assistance must be devised.
Past strategies designed to address youth unemployment haven’t had any significant or long-lasting impact. Young people have said they feel inadequately prepared for the job market. They feel the current education system is letting them down. They want training courses such as FLO and TAFE to be more fully integrated into mainstream schools and they want opportunities to help design the solutions needed, rather than be told what will work best for them by adults who really don’t know.
This is not a government problem. Neither is it a business problem. It is not a problem to be solved by charities or non-government organisations. It is everybody’s problem.
If we are to “build back better” in SA, everyone needs to be contributing. We need a rise in productivity that will see no one left behind; where everyone, particularly young people, can get a foot in the door. We need to embrace a model of economic and jobs growth that ensures our young people are prioritised. One where they are included in the strategies developed and are invited to be at the table to benefit from any solutions devised, so that they can be actively contributing to and benefitting from ‘the new future’ designed, in whatever form it takes.
If we want to grow confident, creative, connected young people, who are able to participate in society, we need to grow jobs, employment and opportunities for their participation. The opportunities need to come from within their own communities. We need to look closely at the work and career ecosystems we put in place now, and we need to do this with direct input from young people. The disjointed approach we currently use, just won’t get us there.
To help us better understand how the current system is not working for young people in South Australia, I have prepared two spotlight reports which will shortly be released. The first identifies what parents have said is hardest about supporting young people to pursue their future work and study opportunities here in South Australia. The second is a spotlight on work experience, and the opportunity it offers young people to make the transition from school to employment more easily if properly implemented.
Both reports ask that an ‘ecosystem approach’ be taken by government, business, community and education leaders and decision-makers leading to the development of a Statewide Youth Employment Plan; a multi-faceted approach that moves beyond each stakeholder focusing on just their one piece of the puzzle.
This approach asks stakeholders to find ways to work together to build a system that supports young people to prepare for jobs of the future. It needs to be an ecosystem that not only delivers real jobs, but which enables young people to learn the critical skills they’ll need to manage portfolio work, self-employment, contracting and freelancing opportunities, likely to be a feature of future employment arrangements.
The system we build must address the individual requirements of young people. It cannot be a cookie-cutter solution but instead must incorporate local labour market settings and strategies that take into account the direct input of young people at whom they are aimed.
It must also have a greater focus on addressing the structural issues that will underpin South Australia’s economic recovery and development. That way next generations of young people can reimagine their futures away from stagnating un/underemployment levels that have sadly and reprehensibly grown to become accepted as being part of ‘the norm’.