Unemployment Issue in Australia: Last 10 Years and its Effects on Economy

This article examines the issue of unemployment in Australia over the last 10 years and its impact on the economy. It discusses the reasons behind the unemployment rate, its impact on the per capita income, and the government policies to reduce unemployment. The policies include tax benefits, infrastructure development, and encouraging female participation in the workforce.

EXAMINE UNEMPLOYMENT ISSUE IN AUSTRALIA IN THE
LAST 10 YEARS AND ITS EFFECTS ON AUSTRALIAN
ECONOMY. DISCUSS GOVERNMENT POLICIES TOWARDS
REDUCING UNEMPLOYMENT

Table of Contents
Introduction......................................................................................................................................3
Australian Unemployment Issues....................................................................................................3
Unemployment issues of Australia in last 10 years.........................................................................3
The reason for unemployment in Australia.....................................................................................4
Impact of unemployment in Australia economic growth................................................................6
Government policy for overcoming unemployment........................................................................7
Conclusion.......................................................................................................................................8
References......................................................................................................................................10
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Introduction
Australia is one of the demographic countries, which is suffering in economic problem. The
economic distress was generated due to the long-term unemployment of youths. The percentage
of the unemployment was increased till the year 2018, which creates the nightmare among the
youth’s ad investors to proceed. The most of the employees in Australia was under-waged due to
the high rate of unemployment. Per capita income has lower down due to the issue of
unemployment. In Australia, most of bachelors are employed whereas married individuals fail to
get the job. The reason might be productivity and their upgraded skills. The Australian
government has adopted the policy to fabricate the new economic structure with the G20
committee (Smith, 2018). The Australian government placed the new agenda to energies the
youths.
The policy will help the country to attract the new investors with fewer tax liabilities. This may
create the ample opportunity for the Australian youths to make them employable. The policy also
helps the country to encourage females to participate in the workforce.
Australian Unemployment Issues
Unemployment issues of Australia in last 10 years
The higher rate of unemployment creates hedges towards the growth of per capita income of one
country.
Australia is a country where unemployment grabbed the economic growth.
Year 2008 2010 2012 2014 2016 2018
Unemployment
rate
3.5% 5% 5.5% 6% 6.3% 6.5%
Table 1: Chart of unemployment
(Source: Learner)
Australia seasonally adjusts their unemployment with the new strategy and government rules. In
August, 2018, the employment increase by 44000 compared to the previous month. The number
of unemployed individuals will deteriorate by 15000 in the foreseeable future. The
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unemployment rate in Australia in the year 2008 is near about 3.5% which increased by 5% in
the year 2010. The unemployment growth rate has created an alarming situation for the citizens.
The Australian government law is unable to increase employment for Australian citizens, due to
the failure of government rules. In the Australia, most of the employee are performed under-
waged that is why the percentage of the unemployment increased in the year 2012 to 5.5%. The
unemployment rate was increasing after the year 2008. Australian government finds out the main
reason behind the unemployment is lack of investment, overpopulation, lack of skills and back-
dated infrastructure. As per the economic report of the Australia marital status left an impact in
the unemployment percentage. The singles of Australia are comparatively high unemployed than
married employee. In the year 2005, 3% of married individuals were unemployed in Australia.
At the same time, there are numbers of singles are unemployed in Australia, the reason behind
that the less pressure of earnings or wages to support their families. Prolonged unemployment is
also the main cause for break down marriage in Australia. Many employees in Australia are
unemployed because they do not find their suitable job.
In Australia, most employee and workers work under the wages system, so there is the less scope
for the citizen to find the adequate job which might be a reason for unemployment. The new
entrants to Australia are trying to find out the adequate job but fail to do so. The up-gradation of
technology and automation also creates a hedge to reduce the unemployment in Australia. The
up-gradation of the technology performs the multiple tasks of employee and cost effective for the
employer which hikes unemployment after the year 2010. The industry shut down play a key role
behind the reason of unemployment in Australia. The industrialist does not get the benefit from
the country for their geographical location, huge no of industry were shut down their business for
this reason. Australia adopts the policy of standard international definition of unemployment to
get rid of the menace.
The reason for unemployment in Australia
Australia is a country where unemployment grabbed the economic condition due to various
reasons.
Shutdown of industry
Industry shutdown is the obvious reason in Australia for unemployment. The industry has failed
to establish their business domain in South Australia for the incapable workers. Government
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planning has failed to prepare the workforce, but some employees of the nation blamed the
financial institution to not support them. Geographical location is also an obstacle behind the
reason. The industrialist raised the reason that they won't get benefit from the other's country for
manufacturing purpose.
Infrastructure
Infrastructure is also a point behind the reason of unemployment in Australia. The Australian
workers were deprived of the scope of infrastructure because of their incapacity to perform. The
entrepreneurs hire the workers from outside the country for the betterment of their work. The
South Australian government used major workers for project but the workers were failed.
Off-shoring
The economic experts find out that the off-shoring is also the reason for unemployment in
Australia. The Australian government failed to provide the tax benefit to the business sectors,
which other country provides. Industries are avoiding expanding their business in Australia
because of that. The industry does not get any benefit for the export purpose so in that case, the
reason creates a hedge to hike the revenue. The entire economic structure of South Australia is
service oriented rather than the manufacture or export and the initial steps of the government
towards agricultural growth.
Recession
The recession is also a reason behind the unemployment in Australia. The Australian company
tightens their belt during the recession. Mitrou et al. (2014) mentioned that most of the workers
in Australia are not perfect for the work, so in this regard for the betterment, the company
reduces the number of the employees. Then of course employment will increase for a while.
Technology and automation
The up-gradation of technology and automation creates the scope of unemployment in Australia.
Ward (2015) asserted that the upgraded technology performs the multiple tasks that generate the
myriad unemployment. Australian labors are imperfect for the performance in that case the
companies take the advantages of technologies rather than human being which may lead to
unemployment. There are some other sectors where technology helps the organizations.
Intention of singles
The intention of the singles in Australia is not in favor of the work. The singles are always
unwilling to work, because they do not have the pressure to support the family. The married
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couples were less unemployed in comparison with singles. In the year 2008, 3% of married
couples were unemployed. Unemployed people are less interested to get married and single
people have the less financial pressure and therefore more encourage the unemployment.
New Entrants
The youth of the Australia is new entrants to the job market. As such it takes a long time to get
settled in a steady job. Bidargaddi et al. (2015) stated that the new entrant often faces the spells
of short time unemployment in their endeavors to search for the suitable job. In case of suitable
job searches, the youth may face long-term unemployment.
Impact of unemployment in Australia economic growth
The unemployment in Australia hindered the per capita income of Australia. Australia is dealing
with the economic crisis due to unemployment. Christiano, Eichenbaum, and Traband (2016)
asserted that the long-term unemployed denotes that the number of workers, who are
unemployed for more than one year. The unemployment of Australian left an impact on the
national poverty line. In the year 2018, the unemployment percentage raised to 6.5% which was
the highest. The reason behind this unemployment rate is advancement of technology and
automation where Australian youth lacks their skills in these sections. Pissarides (2000) asserted
that this affects on the overall economy of Australia. Almost 50000 young Australians are
currently unemployed for more than 12 months and some of are more than 2 years.
Bloch and Bhattacharya (2016) narrated that the investors express their negative desire to invest
in Australia because of their poor economic conditions. The global financial crisis was 8.2% in
the year 2008 which double in the year 18.2%. The long-term unemployment creates the menace
to young Australians. It struggles to get a stable and well-paid job. Luigjes and Vandenbroucke
(2015) asserted that the unemployment of Australia pushes back the country to generate the
revenue through the help of taxation and incentives benefit. The citizens of Australia are unable
to pay the tax due to unemployment. Mitrou (2015) asserted the extended period of
unemployment in this formative year affect the future prospects and economic growth.
Nowadays the youths of Australia are complicated by the fact that in Australia there is no clear-
cut pathway for full-time job seekers. The new entrants from the different country were
expressing their fear to establish their carrier in Australia. The families in Australia were major
affected by this cause.
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The Australian government adopts the policy to reduce the long-term unemployment but due to
short-term employment, the employees of Australia are less interested to work full time. Gregory
and Smith (2016) argued that the employees of Australia fail to recognise their self-esteem due
to lack of adequate job. This, in turn, reduces the likelihood of employment and makes the
economic situation worse. The apprehension of long-term unemployment has been associated
with the hopelessness, low self-esteem, and frustration among the youth. The causes of
unemployment create the motivational problem among the Australian youths because the
government failed to provide them adequate work. The entrepreneurs of the Australia can hire
the employee with the under waged rate. Kroft (2016) stated that the youths of Australia are
ready to perform the work with low remuneration unemployment in Australia. Most Australian
families need two way of income source in order to meet the necessities. Poverty and social
welfare cost have been raised by higher unemployment and job insecurities. With the flood of
new entrants in Australia may lead to the lower end of job market, wages are reduced and
employers can easily retain some employees in low remunerations.
Government policy for overcoming unemployment
The Australian government is focusing on the labor market performance and productivity. The
unemployment of the Australia has led to fiscal deficit in the budgetary performance. The
Australian economy is still suffering from the strain of long-term unemployment. Long-term
youth unemployment and less participation of female have posed challenges towards Australian
economy. Flèche and Layard (2017) asserted that the Australian government is working with the
G20 partners to implement an international action on unemployment issue. The policy ensures to
benefit Australian economy by generating 2 million jobs in upcoming 10 years.
Farber and Valletta (2015) asserted that the government’s ten years enterprise tax plan aims to
improve the opportunities for business sectors by strengthening their ability to compete in the
international market. Saunders et al. (2016) mentioned that the government expresses their
priorities in their agenda to meet the fiscal deficit in budget. $70 billion is invested for improving
the quality of infrastructure of transportation which fosters innovation and entrepreneurship. The
Australian government is also working to reduce the tax liabilities and regulatory burdens on
business so that companies can establish their presence in global market. The government also
announced that they are improving the workplace operation to restore the balances.
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The government is working on improving the performance of Australia's employment service
system. Australia's restructured market policy helps to deliver better outcomes for job seekers.
Brand (2015) stated that the government also meets the expectation of job seekers by delivering
the support. Youths will get the opportunity to get their employment after completing their
education. Considering education to be the base of employment, government has focused on
improving the outcome of education services. The government acquired the steps to prevent the
population aging and support economic growth. The government encourages the youths to
participate in the workforce. The Australian government has invested $855million in youth
employment package where government has focused on Youth Jobs Path programs (Warr, 2017).
The Australian government has implemented the strategies of pension scheme to support family
payments. In addition to this, the government initiated the new leave scheme to encourage the
female to participate in the workforce. The Australian government takes steps to encourage the
employment skills and development. NEIS program has launched to encouraging entrepreneurs
from Australian Youths. Government also has funded $50 million to the non-government and
non-profit organisations to ensure support for the Australian Youth. The government strategies
are to meet the employee's skill by increasing the knowledge about the latest market equipment.
This governmental agenda will provide long-term benefits for Australians job seekers. The
Reserve bank of Australia observed that when economy is growing strongly then the
unemployment rate will be in between 5%-6%. The IEP (indigenous employment policy) formed
by the Australian government adopt the numerous initiatives to protect the youths of Australian
from long-term unemployment. The foreign investors express their willingness to invest in the
Australia due to these initiatives. The Australian government declares the import and export
benefits for the investors to attract more foreign investors.
Conclusion
The history of the Australia yields the demographic suffering. The country is suffering in the
economic problem regarding long-term unemployment of youths. Due to the cause of long-term
unemployment, the job seekers were performed in the country under the waged rate. The
economic situation creates the nightmare among the youth job seekers about the economic
conditions. As a consequence, the initial potential of the youths may deprive and loss the self-
confidence. The hindrance also creates for the new entrants who are willing to establish their
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carrier. The Australian government with the consultation of G20 implements the new law,
agenda and policies. The government takes the step which reforms the economic conditions. The
newly adopted policy perhaps is fruitful to reduce the number of unemployment by 15000. The
taken initiative also encourages the Australian female to participate in the workforce.
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