Young Australians will be better off than their parents in health, technology and incomes but could be worse off in employment, housing, costs of living, the environment and quality of education, according to a report released today.
Prepared by the Foundation for Young Australians, the Renewing Australia’s Promise report says that job prospects for young people are in some ways more uncertain than 30 years ago.
Youth unemployment is more than 13%, increasing four percentage points in the past six years.
“This rise has led to the average young Australian spending an additional five months unemployed when young,” the report says.
“Today’s young people are three times more likely to be in part-time and casual work than their parents were at the same age. And they are 3.5 times more likely to be underemployed.”
For today’s youth, work has become more precarious and they are more tenuously attached to the labour force – reflecting both circumstance and choice.
For some, the quality of job opportunities has fallen. “Others are juggling the competing demands of work and study, and many are coping with the financial impact of rising education expenses.
"Some will take advantage of a more flexible labour market, where careers are not set for life.”
But the situation can be dangerous for many young people, the report warns, because “periods of unemployment and underemployment can cast a long shadow, reducing earnings and career achievement over the entire working lives of those affected”.
“While youth unemployment today is broadly unchanged from a generation ago, the headline data masks a significant change in the attachment of young people to the workforce,” the report says. “Youth underemployment has skyrocketed over the past 30 years from just over 4% to more than 16% today.
"Taking into account the unemployment and underemployment of today’s youth, the problem of insufficient work for young people is probably larger today than it was for their parents with close to 30% of young people in the labour force not working as much as they would like.”
While incomes for young people have risen “modestly” – their wages are 6.8% higher in real terms than 30 years ago – the report points out that expenses have gone up.
After adjustment for inflation, young people will on average pay 2.7 times what their parents did for their houses.
The parents of young people as they were entering the property market had an average home loan of $30,000, while for young people today the average loan for first home buyers is $308,000 – adjusted for inflation this is more than a tripling.
Educational attainment has risen significantly over the last 30 years, with the young 1.6 times more likely to finish school and 1.4 times more likely to gain tertiary qualifications.
But on some international benchmarks the quality of education is deteriorating, and the cost has risen dramatically since their parents’ day.
“The cost of higher education may rise over the next several years by 30% above the around $24,000 on average that a university degree already costs, a far cry from the free education experienced by their parents.”
The report says that when young Australians were surveyed about whether their lives would be better or worse than their parents, only 22% said better.
“So fewer than a quarter … were confident they would exceed the living standard of their parents.
"If the majority of young people are correct about their future welfare, they will be the first generation of Australians to do worse than their forebears.”
The report says that recent Australian policy debates have focused heavily on the ageing population.
“But it’s our young people who will provide the real solutions to the ageing challenge. Young people will be the taxpayers, the health workers, the leaders and the carers. It is their ingenuity and toil that will power Australia.
"That is why the flourishing of young people is important not just for their own sake, but for the benefit of all of us.”
Over the next 40 years the number of people under 24 will rise from 4.3 million to 6.3 million.
Foundation CEO Jan Owen said Australia urgently needed a national conversation about the challenges facing young people.
The Foundation for Young Australians is an independent non-profit organisation.