Migration and youth unemployment

In any debate about migration, youth unemployment will be one of the first figures raised by opponents. How can you argue against a 19 year old kid out of work? The current youth unemployment rate is 13.4 per cent.

For sometime, I thought the introduction of mass temporary migration – international students, working holiday makers and 457 visa holders – since the mid-1990s might have exacerbated youth unemployment relative to general unemployment. Students in particular are highly concentrated in urban areas and are assumed to work in entry level jobs. We haven’t had a recession since 1991 but temporary migration is a new feature of the labour market since then.

So this from Jeff Borland in May 2015 was interesting:

“It has been suggested that the current episode of higher unemployment involves some ‘new’ features – high youth unemployment, high long-term unemployment and large regional disparities in unemployment. Analysis of previous downturns, however, reveals that these features were all present. Hence the current high rates of youth unemployment, for example, seem to be best regarded as a manifestation of the cyclical downturn rather than a long-term worsening of the labour market outlook for the young.

This is positive for supporters of migration. Youth unemployment was high in the past without temporary migration. It will be high in the future with hundreds of thousands of temporary migrants. The “manifestation of the cyclical downturn” reduces the likelihood migrants are substituting youth out of jobs and points toward the natural ups and downs of the economy. However I figure this type of evidence is not going to persuade. Blaming migrants for unemployed young Australians hits a particular emotional nerve for many and is difficult to respond to.

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