Daily Bulletin


The Conversation

  • Written by Jenny Chesters, Senior Lecturer/ Research Fellow, University of Melbourne

It is well-established that recessions hit young people the hardest.

We saw it in our early 1980s recession, our early 1990s recession, and in the one we are now entering.

The latest payroll data shows that for most age groups, employment fell 5% to 6% between mid-March and May. For workers in their 20s, it fell 10.7%

The most dramatic divergence in the fortunes of young and older Australians came in the mid 1970s recession when the unemployment rate for those aged 15-19 shot up from 4% to 10% in the space of one year. A year later it was 12%, and 15% a year after that.

Unemployment rates 1971-1977

Recessions scar young people their entire lives, even into retirement ABS 6203.0 At the time, 15 to 19 years of age was when young people got jobs. Only one third completed Year 12. What is less well known is how long the effects lasted. They seem to be present more than 40 years later. The Australians who were 15 to 19 years old at the time of the mid-1970s recession were born in the early 1960s. In almost every recent subjective well-being survey they have performed worse that those born before or after that period. Read more: There's a reason you're feeling no better off than 10 years ago. Here's what HILDA says about well-being Subjective well-being is determined by asking respondents how satisified they are with their lives on a scale of 0 to 10, where 0 is totally dissatisfied and 10 is totally satisfied. Australia’s Household, Income and Labour Dynamics survey (HILDA) has been asking the question since 2001. In order to fairly compare the life satisfaction of different generations it is necessary to adjust the findings to compensate for other things known to affect satisfaction including income, gender, marital status, education and employment status. Doing that and selecting the 2001, 2006, 2011 and 2016 surveys to examine how children born at the start of the 1960s have fared relative to those born earlier and later, shows that regardless of their age at the time of the survey, they are less satisfied than those born at other times. Subjective wellbeing by birth cohort over four HILDA surveys Recessions scar young people their entire lives, even into retirement Subjective well-being on a scale of 0 to 10 where 0 is totally dissatisfied and 10 is totally satisfied. Regressions available upon request The consistency of lower levels of subjective well-being reported by the 1961-1965 birth cohort suggests something has had a lasting effect. An obvious candidate is the dramatic increase in the rate of youth unemployment in at the time many of this age group were trying to get a job. Over time, labour markets can recover but the scars of entering the labour market during a time of sudden high unemployment can be permanent. Read more: The next employment challenge from coronavirus: how to help the young The impacts of the early 1980s and early 1990s recessions on young people were alleviated somewhat by the doubling of the Year 12 retention rate and later by the doubling of university enrolments. But the education sector is maxed out and might not be able to perform the same trick for the third recession in a row. Reinvigorating apprenticeships and providing cadetships for non-trade occupations might help. Otherwise the effects of the 2020 recession on an unlucky group of Australians might stay with us for a very long time.

Authors: Jenny Chesters, Senior Lecturer/ Research Fellow, University of Melbourne

Read more https://theconversation.com/recessions-scar-young-people-their-entire-lives-even-into-retirement-137236

Writers Wanted

How unis can use student housing to solve international student quarantine issues

arrow_forward

The floor is lava: after 1.5 billion years in flux, here's how a new, stronger crust set the stage for life on Earth

arrow_forward

Play Poker Online Here With The Best Odds

arrow_forward

The Conversation
INTERWEBS DIGITAL AGENCY

Politics

Prime Minister Interview with Ben Fordham, 2GB

BEN FORDHAM: Scott Morrison, good morning to you.    PRIME MINISTER: Good morning, Ben. How are you?    FORDHAM: Good. How many days have you got to go?   PRIME MINISTER: I've got another we...

Scott Morrison - avatar Scott Morrison

Prime Minister Interview with Kieran Gilbert, Sky News

KIERAN GILBERT: Kieran Gilbert here with you and the Prime Minister joins me. Prime Minister, thanks so much for your time.  PRIME MINISTER: G'day Kieran.  GILBERT: An assumption a vaccine is ...

Daily Bulletin - avatar Daily Bulletin

Did BLM Really Change the US Police Work?

The Black Lives Matter (BLM) movement has proven that the power of the state rests in the hands of the people it governs. Following the death of 46-year-old black American George Floyd in a case of ...

a Guest Writer - avatar a Guest Writer

Business News

Nisbets’ Collab with The Lobby is Showing the Sexy Side of Hospitality Supply

Hospitality supply services might not immediately make you think ‘sexy’. But when a barkeep in a moodily lit bar holds up the perfectly formed juniper gin balloon or catches the light in the edg...

The Atticism - avatar The Atticism

Buy Instagram Followers And Likes Now

Do you like to buy followers on Instagram? Just give a simple Google search on the internet, and there will be an abounding of seeking outcomes full of businesses offering such services. But, th...

News Co - avatar News Co

Cybersecurity data means nothing to business leaders without context

Top business leaders are starting to realise the widespread impact a cyberattack can have on a business. Unfortunately, according to a study by Forrester Consulting commissioned by Tenable, some...

Scott McKinnel, ANZ Country Manager, Tenable - avatar Scott McKinnel, ANZ Country Manager, Tenable



News Co Media Group

Content & Technology Connecting Global Audiences

More Information - Less Opinion