17 February 2012

Stand Up cautions simplistic solutions to youth unemployment

The Salvation Army report released today has highlighted many issues of growing inequality and poverty. It also identified that young people have borne the brunt of the recession and been worst affected by unemployment, a concern shared with Stand Up, the youth union movement.

James Sleep, Stand Up spokesperson said “this report is another in a growing list that shows the urgent need for the government to step up on the issue of youth unemployment. We need a sharper focus on the issue and additional resources need to be brought into creating work, education and training opportunities for young people to transition into, and to developing better youth transitions from school or training into work.”

“However, we want to caution overly simplistic proposals to solve this issue. In response to the report business groups have again called for a youth rate to be installed. But research (from Dean Hyslop and Steve Stillman) that looked at the impact of between 41% - 69% increase in the youth minimum wage in New Zealand found no evidence of adverse effects on youth unemployment.”

“What we know, and what the research shows is that lowering the minimum wage for young people is less likely to create jobs than stronger overall economic conditions.”

The report also states that one of the most noticeable employment trends over the past 5 years has been a move to more people over 65 working, and fewer teenagers working. One in five over-65s are still in paid work - up from one in seven in 2006, while only one in three teenagers is in work - down from half five years ago.

“However we can’t just jump to the conclusion that increasing employment of over-65s has actually caused youth unemployment- it is neither proven or helpful. There are many different causes of the changing employment patterns, including more young people participating in education, and the impact of the global crisis on older people has led to changed labour market patterns.”

“This isn’t about replacing one group of workers with another: it should be about growing jobs for everyone,” said James Sleep.

ENDS

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