Under-employment of young Australians is costing the economy up to $21 billion and up to 70 per cent of university and TAFE students are accumulating HECS debts for jobs that wont exist in 10 years, research has found.
The PwC Young Workers Index has found Australia has dropped four places to 17th in OECD rankings for employment of under 25-year-olds.
PwC Australia economics and policy partner Jeremy Thorpe said a focus on STEM skills, in particular mathematics, was key to addressing the downward trend.
“Australia now ranks lower than all other OECD countries in the Asia-Pacific. We are well and truly middle of the pack among the 34 nations despite holding firm at 13th place between 2006 and 2011, during the worst of the global financial crisis,” Mr Thorpe said.
The report, which used World Bank and official government statistics, found in the nine years between 2006 and 2015, the unemployment rate for 15-24 year olds in Australia increased by 3.3 per cent, from 10 per cent to 13.3 per cent
During that period the incidence of long-term unemployment increased by 6.5 per cent to 17.6 per cent and school drop-out rates for 20-24 year olds increased by 3.5 per cent to 23.1 per cent between 2001 and 2011.
“If we’re going to boast the employment and skills of younger workers in Australia we need to draw lessons from the likes of Germany,” Mr Thorpe said.
“With 75 per cent of the fastest growing occupations requiring STEM skills, improving STEM education – mathematics in particular – and shifting our workforce into STEM, will be essential if we’re to effectively leverage young workers,” Mr Thorpe said.
Mr Thorpe said Prime Minister Malcolm Turnbull’s recent roundtable discussion at Western Sydney University on ways to drive more collaboration between industry and academia was “a great step forward”.
The Foundation for Young Australian’s annual report found that despite young people staying in education longer, they are still not getting the enterprising skills they need to get a job.
It’s taking an average of 4.7 years once they finish full time education to find full time work and FYA’s chief executive Jan Owen said 25 per cent of tertiary graduates are unemployed or underemployed.
“In 2008, 84 per cent of university graduates were in full time work four months after leaving university. Today that figure has dropped to 65 per cent,” Ms Owen said.
“Between 60 to 70 per cent of young people at university or TAFE are getting HECs debt for jobs that wont exist in 10 years. This is a terrible waste of the potential our young people have to drive our economy forward and create a better future for our nation.”
Ms Owen said there needed to be a change to school core curriculum so it was a “real life dress rehearsal” and skills such as financial literacy were taught with the report showing 30 per cent of 15 year olds are not financially literate and 35 per cent are not good at problem solving.
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