Comprehensive Study of Unemployment in Australia: Economic Impacts

This essay provides a comprehensive analysis of the unemployment issue in Australia, exploring its various facets and impacts. It begins by defining unemployment and its economic consequences, setting the stage for an examination of Australia's specific context. The essay delves into the historical trends of unemployment in Australia, highlighting fluctuations and key periods such as post-World War II and the early 2000s. It then addresses the current concerns, particularly the shortage of skilled labor and its effects on businesses. The essay examines the differing experiences of various demographic groups, including single versus married individuals, youth, older adults, and migrants, in relation to unemployment rates. It also discusses underemployment and its implications. Throughout, the essay uses statistics and data to support its arguments, providing a detailed overview of the complexities of unemployment in Australia and its economic and social implications.

Unemployment issue in Australia
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Unemployment issue in Australia
Unemployment has become a scourge in most countries at every level of economic
development.it is known to bring about poverty and a feeling of exclusion from the ways of life.it
brings down or slow the development of young people and end up bringing conflict into homes.
Most market economies face some issues of unemployment which come up from the active birth,
the growth and the reduced death rates and the decline of industries and the changes that are
taking place in the employment sectors. Others like the frictional unemployment are reported to be
tolerable. Unemployment damages an individual together with his or her family given that it persists
for an extended period (Bell, 2012 pg.98).
The economy of Australia has faced numerous changes in the line-up of what it produces
and the way it produces it. The change in technology has perpetuated the latter: through more
integration to the global markets and the rise in competition from the countries who offer lower
wages in the manufacture of goods and services, changes in the patterns of consumer purchase with
the increase in the real incomes (Corden, 2011pg.162). The loss of jobs in the manufacture of goods
and services has led to the deterioration of employment opportunities for those workers who have a
modest level of education. The latter is well depicted by the statistics of unemployment.it is also
evident in the rates of withdrawal from the workforce by such kind of workers. Contrary to this, the
larger part of the economy has been noted to be expanding chances of employment for the female
labor force and whose share of payments has been increasing very fast. From the point of view, the
issue of unemployment in Australia has been a nagging one and has been the problem of the
country for quite an extended period. However, a commendable expansion in the economy which
has lasted for thirteen years has seen the reduction in the unemployment issue. The profits of
reduction of unemployment are seen even in areas that are most problematic like the
unemployment rates in the youth, the prolonged unemployment and the poor employment
opportunities available for the older adults (Bell, 2012 pg.112).
The concept of Unemployment is not as precise as viewed by most people. This is evident in
countries like Australia, a country in which most goods and services are produced by the use of the
formal economy, and in most cases, people here work for wages (Harris, 2013 pg.199).The country
adopts the international naming or definition of the term unemployment: unemployment occurs if a
person or people were not in work for at least an hour in the previous week or they were looking for
a job and fortunately were able to agree to undertake an individual job the following week if it
would be available. When asked whether they worked the previous week, those people who work in
a black economy have a higher chance of telling a lie. Those who want a job but have given up in
looking for jobs are excluded from the measure of unemployment. The latter then gives the
government an advantage in measuring the level of unemployment through the provision of a
minute welfare payment that at long run kicks people out of the workforce. A person is hence
counted as employment if he or she worked for at least an hour in the previous week. A big
difference comes in between working one hour and forty hours per week since there is a difference
between the income and effort put. A report shows that the Australian Bureau has constructed
measures to curb unemployment as well as under employment (Harris, 2013 pg.171).
After the world war 11, the rate of unemployment in Australia varied between one and two percent
of the labor force. A Bigger percentage of the workers were men, and the culture was that women
were not supposed to seek for employment lest they were married. There was a high level of birth
rate (baby boom), a period that gave birth to a fertility rate in Australia that up to date has never
been replaced. The diagram below shows the history of unemployment in Australia (Marks

Unemployment issue in Australia
&Fleming, 2012 pg.198).
As shown in the diagram, the rate of unemployment goes up very sharply during the period
of recession. It takes a relatively long time to do own after the spell. Thou there rose a small peak in
early 2000`s; the latter was only a fraction of the previous points. The last point shown is the most
significant one that can be used to explain the low level of unemployment. The reason as to why
Australia has seen success in the avoidance of recession which is part of the business cycle will be
tacked in another point of explanation. The latter has made the rate of unemployment to go down
even below the high levels reached during the peak season (Marks &Fleming, 2012 pg.188).Today
the concern of the businesses in Australia is the shortage of skilled labor. Back in the year 2005,
firms recorded lack of skilled labor in large numbers.55% of these companies explained that they
failed to expand their businesses due to the shortage of labor. The latter information was as a result
of a survey that was carried out by the national bank of Australia. The figure shown below shows the
primary factor that made firm s to shift from the lack of sales to lack of suitable labor (Picardie, 2013
pg. 145).

Unemployment issue in Australia
There is no uniform distribution of unemployment across the labor force. Some of the
groups are at a higher risk of being unemployed (Picardie, 2013 pg. 132).
Gender and the people’s marital status
Focusing on the age group 25-65 years, there is some different experience of the men and
women looking for jobs. The level of unemployment is assumed to be similar in both males and
females. In both sexes, the single people are more likely to be unemployed than the married
population in both genders (Shan, 2011 pg. 182). Less than 3% of the married couples were
unemployed. The unemployment rate for the single people was four times more than that of the
married people. The reasons for the correlation between the married and the single were complex,
and the causes have a possibility of going in both ways. For instance, men who are not yet married
are less attractive and hence have a higher probability of being single. Those who are single in turn o
not have the pressure to earn to provide support to their families and hence can prefer to tolerate
the long spell of unemployment. Extended periods of unemployment in marriage can also lead to

Unemployment issue in Australia
couples breaking up (Picardie, 2013 pg. 132).
Groups that are at Risk
Adding to those people who are single, there are other groups of people that experience
higher levels of unemployment .two of these groups include the youth and the old people. Any given
group entering the job market takes some time before settling in a given pattern of employment.
Many people try out jobs then after some time, they leave it because it does not fit their
preferences. They then continue searching for the one that suits their abilities and ambitions, and
this is the time that they experience short terms of unemployment (Parkin, 2014 pg. 100). A bigger
number of this kind of people are not successful in the search. They face extended periods of
unemployment while others move between low paying jobs, insecure employment and others
remain unemployed. The employers tend taking young people on a temporary basis as they establish
whether they are suitable for the jobs offered. If at all the company finds out that the youth
employed is not fit for the job, then they lay them down, and they hence have to start looking for a
new job hence spending time unemployed in the meantime. The kind of unemployment that is
associated with this search is not problematic given that the job seeker can find the kind of a job he

Unemployment issue in Australia
or she is seeking within a given period (Parkin, 2014 pg. 112).
The measures of the unemployment in youth are complicated since in Australia there is no
pathway to differentiate between full-time students to a full-time worker. The youth combine
education and job in a variety of ways. Most of the teenage students and also the full-time tertiary
students have at least a part time job. An approximate of one million adults who work at the full
time are also students. The young people try different categories of post school learning as they also
give a hand in the various kinds of jobs. Few teenagers look for full-time jobs (Shan, 2011 pg.
112).The reason for the latter is because such kind of jobs are rare to find even in a case where the
labor market is tight.an approximate of 20% of the young people who are looking for full-time jobs
are unemployed. The figure seems to be high, but in the real sense, it has fallen from peak since the
last recession of 1992 in Australia read 32%.the strengthening of the labour market, in general, has
helped the youth a lot as well as those other groups existing in the labor force. The 4th figure below
shows the benefits that have directly flowed to the youth. The fall in unemployment of the older
people has also decreased significantly in that by the year 2005, only 2% of the older adults who
were aged 55-65 were not employed. The decline in the rate of unemployment for the older people
gave rise to the turnout for this kind of a group (Healey, 2013 pg. 123).
The second group that is facing a massive rate of unemployment is the migrants. The
migrants face additional problems whose primary cause is the lack of fluency in English, lack of them
being familiar with the English culture and the fact that their skills are not automatically accepted by
the employers (Healey, 2013 pg. 163).
The Australian government runs an immigration program that has three main components.
They include: the skilled migrants, who are selected because of their ease of integration with the
Australian labour market: reunion of the family whereby a person is given sponsorship by a parent

Unemployment issue in Australia
who I already a permanent resident of Australia and the third one is the humanitarian whereby a
given immigrant is accepted on the grounds of clemency. There has been a shift in the balance and
shift towards the migrants who are skilled (Healey, 2013 pg. 163).For a migrant to be granted the
residency that is permanent, an application that shows a combination of attributes that are known
to be important in the search for a job and mostly the kind of jobs that are capable of using their
skills after they arrive in Australia. These types of attributes include the post educational
qualifications, given recognition in Australia, an experience in a particular kind of a job which is in
high demand in Australia and age that is prime working. Data collected in 2005 showed that the
migrants who met these qualifications were quickly absolved in the labor market. Six months after
their arrival, an approximate of 82% of the immigrants were employed while about 12% were still
tarmacking (Gregory &Hunter, 2012 pg. 137).
Underemployment
The recent record of under employment in Australia is presumably useful, however, to be
termed as employed, we said that a person should have worked for at least one hour in the previous
week. A person can only be unemployed if they are in the workforce and are actively looking for jobs
but are not getting them. The latter suggests that it is possible to have low rates of unemployment
and yet at the same time have a higher number of people who want to work more than the way they
do (Gregory &Hunter, 2012 pg. 156).
Rate of participation
One of the major perspectives on whether Australia has been experiencing an
underemployment is the rate of participation-those people who are aged 1 and above and are
seriously looking for jobs or employed. There have been numerous changes in the participation rate
in the labor force in India. The rate of participation in male fell from 755 to 65 % between the years
1990 to 2005. While that for women increase from 40% to 52%.the reduction in the participation
rate for men was more evident to those under the age of 55 and who had some low levels of
education (Gregory &Hunter, 2012 pg. 143).The figure below shows the changes in the participation
rate since the year 1991.The rate of involvement fairs a positive shift in the demand for labor. The
demand for labor is increasing while the rate of unemployment is going down (Corden,
2011pg.162).The rate of participation is also rising and vice versa. The latter is very important since it
shows that there is the creation of some new jobs. The new jobs are filled by those who were
previously laid off or by those who entered the job market recently. The rate of withdrawal in the
labor market is decelerated when the demand for labor is great (Richardson, 2011 pg. 198).

Unemployment issue in Australia
The removal of those working from the labor force in times of recession is known as hidden
unemployment.
The fall in the rate of participation for the men who do not have post school education shows the
second form of hidden unemployment (Richardson, 2011 pg.125).
Long term unemployment
This is one of the aspects of employment that is in most times disturbing. It goes for 12
months in Australia. The long term unemployment causes economic and social damages by a
significant extent. There is exhaustion in savings and the lines of credit too. Evidence shows that the
longer a person stays unemployed, the lower the chances of getting employed in the future becomes
(Richardson, 2011 pg. 171).
Conclusion
The issue of unemployment has been a tormentor in the economy of Australia and the
western to be precise since early 1970s.the business cycle of boom and recession in the markets for
a long time was the causative agent of the high levels of unemployment in those years. The rates of
unemployment shot up during the periods when we had recessions because most businesses shrunk
and reconstructed. The recovery from these shocks took an extended period and by the time it came
to an end, another period of recession was already with us.in the last decade, Australia has been

Unemployment issue in Australia
fortunate in avoiding any significant downturn, something that has seen a fall in the rate of
underemployment and unemployment .the drop in unemployment rate has benefited almost every
group in the labour force ranging from the youth, the long term unemployed and the older workers.
There is a possibility of keeping the economy growing at the high levels of usage, without
the stirring of the inflation dragon from its chloroformed slumber, the men having low education,
the youth and part time workers need to expect to find reasons for being optimistic about the
future.

Unemployment issue in Australia
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