Media Release: Youth unemployment due to COVID-19 to have significant social impact on young people for years to come

New policy paper by the Centre for Social Impact highlights the significant impact on youth unemployment since COVID-19 with social impacts to affect young people for years to come.

The Centre for Social Impact (CSI) has today released a new policy response to the impact on youth unemployment brought on by the COVID-19 pandemic.

The COVID-19 and Youth Unemployment paper looks at the effect and consequences of the economic shutdowns on employment for young people and policy recommendations to ensure younger Australians can be supported through immediate and long-term challenges ahead.

Lead researcher Professor Paul Flatau from The University of Western Australia said that while COVID-19 has already had significant impacts on youth employment, younger people will be more likely to face deeper impacts in their employment with consequent social impacts in years to come.

“One lasting effect that has occurred after past crises - and that is likely to follow the COVID19 pandemic - is that young people making the transition from education to work will find it more difficult to find employment at entry-level positions due to increased competition for jobs and declining availability of jobs,” Professor Flatau said.

“We are extremely concerned about long-term effects on young people as a result of this pandemic. As research shows, unemployed young people are at greater risk of experiencing mental health problems.

“Without timely and targeted intervention, young adults are at a high risk of missing out on a strong entry into the labour market and, therefore, of being financially disadvantaged and even being welfare dependent for their whole lives,” Professor Flatau said.

Other key points:

• There is evidence that young people from disadvantaged backgrounds tend to be more negatively impacted by the economic effects of a crisis.
• Overall youth unemployment rates mask considerable variability across regions. In some regional areas, such as the Queensland Outback region, over 25% of the youth were unemployed before the pandemic. The current economic climate will disproportionately affect regions already facing high youth unemployment rates. This includes remote, rural and even outer suburban locations.
• The government should Amend the JobKeeper eligibility requirements to cover more young people in the labour market and not return JobSeeker payments to their original poverty level amounts at the cessation of the present additional supplement.
• Government policy should also prioritise employment programs targeted at young people to improve their employment prospects when the economy recovers. Priority should be given to the low skilled and long-term unemployed.
• Young people in the final year of study should be encouraged to continue to study, thus delaying their entry into the labour force to a more favourable time. Providing exemptions from Higher Education Loans Scheme loans and offering free TAFE courses for 202116 are other ideas to help reduce the financial burden on a cohort that will be disproportionally hit by the COVID-19 economic shock.

The CSI COVID-19 and Youth Unemployment fact sheet is available here.