High net migration during a period of no net job growth: implications for young job seekers.

Author:Healy, Ernest
Position:Report

From July 2008 to July 2009 the labour force grew by 166,000 but there was no increase in the number of people employed Consequently this increase translated directly into growth in unemployment. But the burden of unemployment was not shared equally. Previous work has shown that employment actually grew among people aged 55 and over but fell among those aged 15 to 34. Thus young people were disproportionately affected The present article focuses on the contribution of Australia's record levels of immigration. Most of the labour-force growth (88 per cent) has been due to immigration and most migrants in the labour force have found work, partly because changes in social welfare rules make this essential for them, regardless of wages or conditions. In consequence the competitive labour-market pressures facing young Australians are now intense.

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In the previous issue of People and Place, (1) analysis of Australian labour force survey data for the period March 2008 to March 2009 showed that the impact of the economic slowdown since late 2008 was mainly affecting younger persons. Net employment growth in Australia from March 2008 to March 2009 was just 23,000 persons. But employment outcomes varied considerably by the age of the employed persons. Employment growth among persons aged 55 years and over was relatively strong at 122,000. By contrast, there was a decline in employment of 68,000 among persons aged 15 to 24 years.

The strong employment growth among older persons was consistent with the long-term trend of increasing labour force participation rates among older persons (for both men and women) reported in the previous study. (2) The fact that this trend continued at a time when there was little growth in overall employment was a surprising and perhaps disturbing outcome. This is because it meant that young people seeking entry to employment have had to cope simultaneously with competition from the record high intake of migrants and of older persons staying on in employment.

THE LABOUR MARKET SETTING

The scale of the current increase in the number of job seekers is extraordinary. Australia's population is growing by about 400,000 a year. Over the period July 2008 to July 2009 this translated into an increase in the civilian population aged 15 plus of 317,000. Just over half of these, or 166,000, entered the labour force (Table 1). As is shown below, most of this increase is attributable to the current very high level of net migration of around 250,000 per year.

Table 1: Labour Force, July 2008 and 2009 ('000) July 2008 July 2009 Change Employed 10,807 10,807 0 Unemployed 440 605 165 Civilian population (15+ yrs) 17,217 17,534 317 Labour force 11,247 11,413 166 Not in labour force 5970 6121 151 Source: Australian Bureau of Statistics (ABS). Labour Force, July 2009, Table 3: Labour Force Status (original data) Since there was no increase in the number of employed persons over the July 2008 to July 2009 period, the growth in the labour force of 166,000 translated directly into a similar growth in the number unemployed. The point of this inquiry is to assess who is the loser in this situation.

The Australian government has embarked on a risky labour market strategy of maintaining record high migration at a time when there is no net growth in employment. If domestic job seekers are the losers, the Labor Government needs to be held to account.

LABOUR MARKET OUTCOMES

The analysis of recently-released labour force survey data for the period July 2008 to July 2009 shows that the patterns observed for the March 2008 to March 2009 period have been repeated and accentuated. Table 2 shows the net change in employment, unemployment and labour force for the period July 2008 to July 2009.

Table 2: Change in labour force status for persons aged 15 years and over by age and sex, Australia, July 2008 to July 2009 Males Employed full- Employed part- Employed...

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