Around the world, Australians are known for their love of coffee. In fact, the average Australian ordering a medium coffee each day is spending $1522.05 a year on their addiction! Hipsters, executives, and everyone in between rely so much on the passionate and hard-working baristas who sustain the smooth crema of Australia’s coffee drinking culture. However, a significant portion of this barista population are university educated, underutilised or locked out of the labour market for the careers they’ve worked so hard to pursue.

In recent years, there has been a significant decrease in the number of full-time jobs available and youth are being pushed into casual or part-time jobs that are often poor in quality and do not offer enough working hours, resulting in little prospects for long-term skill development and income security. Without a secure income or a clear career path, these highly qualified people are left feeling vulnerable and let down by the system: socially excluded. 

In 2013, 26% of Australian graduates were underutilised in their jobs. A substantial number of young Australians have the opportunity to go to university, but as they graduate the job market is unable to absorb them, leaving them at the end of their degree with a large student debt and no job prospects. With 70% of entry-level jobs for young Australians at risk of automation in the future, youth unemployment or underutilisation will only get worse. It is predicted that over five million jobs in Australia will disappear within the next 15 years as a result of technology.

Australia is not the only country facing these issues. After the Global Financial Crisis, Europe’s youth unemployment rates skyrocketed and steps had to be taken to intervene. In places like Greece the youth unemployment rate is nearly 50%! Perhaps Australia could take some tips from the implemented strategies in Europe to decrease problems such as youth unemployment and social exclusion. The most prominent initiative is the European Youth Guarantee, where each person receives an offer of employment, education, or training within four months of becoming unemployed or leaving education.

Although Australia has not experienced a recession like that of Europe, the strength of the Australian economy is posing a similar problem for the younger generation.  With the combination of a substantial increase in Australian housing prices, and a reduction in the availability of employment, young Australians are finding it difficult to become socially included.

Young people are more vulnerable to unemployment for various reasons and in 2015 the youth unemployment rates sat at 13.1% in Australia, a staggering figure that has doubled since 2008. Although this rate is lower than other global regions, such as 20.4% in Europe, action still needs to be taken to address this issue to ensure these individuals are socially included.

Being unemployed for an extended period of time increases the risk of citizens becoming socially excluded. Social exclusion occurs when individuals are prevented from fully participating in society. Conversely, social inclusion ensures that those at risk gain the opportunities and resources required to participate in economic, social and cultural life, all of which are essential factors in defining an individual’s identity in society.

Research shows long term disengagement from the labour market has serious consequences. As well as the financial strain it places on the unemployed, other effects of joblessness include lower psychological and social wellbeing. When looking from an individual perspective, the effects of social exclusion and unemployment are not only temporary, but have detrimental ramifications on young Australians beyond their transition into adulthood. Engagement and involvement in the workforce is a crucial component of human development in establishing interpersonal skills, a sense of identity, and role in society. The harsh reality is, social exclusion runs the risk of leaving youth with a pessimistic outlook on life, resorting to disengagement from society, delinquent behaviour, and drug use.

The labour market can be dynamic and unpredictable, and social inclusion is crucial to keep youth active and engaged so that when a full-time job does appear, they are ready to take it. Part time and causal jobs are essential building blocks for youth work readiness in gaining resilience, maximising societal participation and accruing valuable work experience. However, at some point there needs to be a transition into full-time employment.

Undoubtedly, young Australians are a very digitally engaged cohort. How could government leverage this engagement to address the social exclusion that coincides with unemployment? Young people are not a homogenous group and need targeted interventions. Using digital capabilities could be the most effective way to identify the best strategies for addressing different cohorts to ensure their continual engagement with the labour market.

The concept of behavioural economics has been successful in significantly changing behaviours such as those related to health and tax, leaving a promising opportunity for implementation in the field of social inclusion. Perhaps leveraging digital to implement a simple “nudge” could make a difference in employment opportunities for young Australians. For example, an experiment in Canada showed that making changes as small as messaging on a job search website, significantly increased “clicks” and sped up the job search process. If youth are being socially excluded, how do we reach out to them? The answer may lie in leveraging rare Pokémon as a way to best engage with the smartphone generation!

In the midst of a youth unemployment crisis, we need to develop interventions targeted at vulnerable cohorts in order to maintain the strength of the Australian economy and a future that is bright for generations to come. Digital may enable policy makers to engage with groups at highest risk of becoming socially excluded.

This article was written by Belinda McKeon and Shaeyen Mackay from the SAP Institute for Digital Government. To find out more about the Institute visit www.sap.com/sidg, follow us on Twitter @sapsidg and email us at digitalgovernment@sap.com.


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  1. Arden Stricke

    Some serious food for thought here Belinda and Shaeyen.

    Some challenging times ahead for Australia

    Thanks for taking the time to put this together

    Arden

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