Question How can the high levels of What are potential solutions for high youth unemployment in Australia be solved, and what are its implications on inequality for young Australians? I. Introduction High levels of unemployment have many negative effects, including rising inequality, which is a major issue in developed economies such as Australia (REF). Income, and wealth inequality are the two main types of inequality examined in economics. Income Distribution Income distribution refers to how the total income of a nation is distributed between the population. An economy with high income inequality will have the majority of the income distributed to a minority of the population (REF). Income distribution can be graphically illustrated …show more content…
Economies attempt to maintain unemployment as low as economically sustainable (referred to as the natural rate of unemployment), because high unemployment creates several issues in an economy (REF). Both unemployment and underemployment are heavily linked to high levels of inequality, as such young Australians are more likely to experience inequality (REF). The focus of this inquiry will be on inequality and unemployment in young Australians. II. Issues High unemployment (and underemployment) have several costs on Australian society. One of the key impacts of high unemployment are the heightened levels of inequality (REF). As young Australians experience higher unemployment (and underemployment) than the average Australian, they also experience significantly higher levels of inequality (REF). Economy High levels of youth unemployment (and underemployment), leads to the economy functioning inefficiently (functioning below the Production Possibility Frontier [PPF]) (REF). Furthermore, a high rate of unemployment means that young Australians lack the appropriate skills required in the workforce, thus more time and money is required from the employer to train the young Australians to be able to participate in the workplace (REF). High levels of youth unemployment result in individuals possessing lower disposable incomes, consequently there is lower aggregate demand. As demand for labour is derived demand, the high levels of youth unemployment will result
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Health risk increased with unemployment. There is evident that the health risk is higher in areas where unemployment is common. Stable and secure work improves to individual’s job satisfaction, well-being and health. Deteriorate illness and premature death caused by higher unemployment (Wilkinson & Marmot 2003). A number of research form many foreign countries shows individuals and their families face comparatively high risk of premature death (Wilkinson & Marmot 2003). Australia indigenous peoples accounted for 2.4% of the Australian population, the impact of factors such as unemployment, imprisonment, low-income, eligible housing, lead them to life expectancy 9-12 years less than other Australian population(Cunningham & Paradies 2013).
Whilst these percentages had changed significantly it was also found that the types of people who were living under the poverty line were still the same. In this report it was found that 75 percent of those living below the poverty line were not in the workforce, and that the aged made up 41 per cent of all Australians that were living in poverty. (Williams, Lawrey 2000) Therefore it is clear that although the poverty line had risen significantly from 1975 to 1987, there has not been an improvement in the percentage of Australians living under the poverty line, but instead this percentage has increased.
An increase in the unemployment rate means that more individuals do not have an income, thus meaning many households suffer reduced disposable funds. This causes a decrease in the level of aggregate demand within the economy and therefore reduces economic growth. This in turn causes a slower circular flow of income, meaning that households may be forced into or past poverty, as a result of the lowered income generated, reducing the living standards and quality of life. The downturn experienced by the economy can also offset many individuals seeing them not wanting to return back to the workforce due to the lack of jobs available, making them long-term unemployed rather than cyclically unemployed, or if the firm initially was promoting structural change, structurally unemployed. Combined with poverty, the aspect of unemployment can lead to other severe mental health issues and illness reaching extremes.
Individuals with higher levels of education tend to have better health, greater social engagement, longer life expectancy and they generally feel happier (OECD 2013). Throughout the Australian history, Aboriginal communities were deprived of basic human rights which resulted in poor quality of life and poor education outcomes
Class divisions can result in tensions between people and different regions. Wage disputes between workers and employers in which workers try to improve their income levels are a common cause of dispute. These divisions can sometimes lead to social and economic instability. As shown earlier, inequality leads to poverty problems but the facts have not been explored. Australia has a very high level of relative poverty with 12.2% of Australians living below the poverty line, defined as receiving an income below 50% of the median income level. Poverty tends to trap families into a vicious cycle of low incomes and limited economic opportunities. High poverty levels also tend to be associated with increased levels of crime, suicide, disease and reduced life expectancy.
Unemployment is a social problem in Australia, which affects a majority of society in many ways. Not only can it cause financial debt to families, but from there it can cause family breakdowns, social isolation, shame and it can even lead to violence. The Conflict theory perspective explains how unemployment can be caused by class and power by focusing on the inequality within society. The inequality sequentially predicts that the poorer members of society struggle to find employment, to be able to get education to find suitable employment and are.
The disparities accounted for in the distribution of wealth and income tends to reflect wealth that is accumulated during a person’s working life and utilised during retirement. Whilst this sources the foundation of inequality, the distribution of income in Australia is influenced by socio-economic factors such as gender, age, occupation and ethnicity. Gender is a common inconsistency in various economies, during 2013 average weekly earnings for males were $1516 while females earned $1250, this is still coherent for males and females in the same occupational categories, and is augmented for opposite genders in different occupational categories. In terms of ethnicity, it has been recorded that persons born overseas earn more than persons born in Australia, that non-English speaking backgrounds earn less than English speaking backgrounds and the period of residence in Australia is proportional to the income earned. However, the lowest income earners in the Australian community are Indigenous Australians and being heavily reliant on government welfare, earn a substantial loss in income compared to that
In any given population, there is a difference between what people within the population earn. The uneven distribution of income in any given population is income inequality. In order for there to be income, there has to be several sources of income. These sources of income may be combinational or independent per person receiving the income. Income may result from wages, rent, bank account interests, salaries or even profits made in business transactions ( Stiglitz, 2012).
“In early 2016, the ABS Labor force found that 258,000 youth aged 15-24 was unemployed” (ABS, 2016), accounting for over a third of total unemployment (721,400 people)” (ABS, 2016). There are several reasons youth unemployment exists in Australia, with the primary cause being low economic
Sociologists study human society. Their studies include human behavior in many social contexts such as social interaction, social institutions and organization, social change and development (Abraham). Because of the broad spectrum of social circumstances that are studied, unemployment is an issue in which sociologists thrive. Conflict in the areas of age, race, gender, and disability is common among the employed as well as the unemployed. From a sociological perspective, unemployment can be studied through both the Functionalist Theory and Conflict Theory. It also touches upon the results of unemployment in societies and institutions such as family, education, government, and health. Unemployment affects almost everyone to some extent
Unemployment is recognised as one of the most challenging social problems currently facing Australia. In the last two decades and more recently with the global recession high levels of unemployment have become an established feature of the South Australian social and economic landscape, with young people aged 15 to 24 years among those hardest hit by unemployment.
Globalization has led to greater inequality in Australia. It could be due to increased trade and growth, and capital liberalization doesn't work in favor of the poor. Governments are supposed to reduce the negative financial market positions and not impose any such policies that would enhance those situations. Instability can cause deterrents for both firms and governments in the same manner. Interest rates being on a rise can reduce investment and a volatile currency will discourage exporters, especially the smaller firms that do not have any financial expertise to guide them. Expansionary policies will also be affected as the cost of borrowing increases. And these pressures on the government demand that it lower taxes and increase incomes, at the same time cutting the government's own spending patterns,
Traditionally Australians have believed in and conveyed the myth of Australia as a fair , egalitarian society without excess wealth or poverty, however we are definitely not a classless society. Australia's education system has been and remains one of the most unequally distributed social resources and could possibly be regarded as the main source of inequality in our society (Encel 1970; Anderson & Vervoorn 1983; as cited in Jamrozik, 2009). Now more than ever, Australia's education system is acting as a kind of 'sorting out' mechanism, allocating people to certain stations within
Money is an important component that can help ones to function properly in this society. However, money defines our self-worth and value in this society. For decades, unemployment has become a big issue in our community. The younger generation are the one who suffers the most from the crisis. In 2009 alone, 6.7 million youths joined the ranks of the unemployed, and compare this with an average annual increase of 191,000 in the 10 years before the crisis 1997 to 2007(Elder,2010). Youth unemployment is a crucial issue in our society. Unfortunately, a lot of young people are going through that situation. When it comes to find a job, young people are the less fortunate for many reasons. For instance, some employers might be biased on ages and believes that young people do not have skills or enough experiences to perform at the level required for the jobs. The problem of youth unemployment has many causes and consequences in our society. Youth unemployment can affect the economy, family relationship, increase crime rates and, mental health.