Unemployment In Australia: Statistics, Impact, And Future Trends Essay.

Unemployment: Concept and Debate

The Australian Bureau of statistics regularly releases the statistics of unemployment rate in the country. The International Labor Organization (ILO) has described unemployment as the situation where the person is seeking a job or work, is available for the same and is still without work. The unemployment statistics of a country speak a lot about the labor market and the situation of the country. They give a glimpse of the growth statistics of the country and speak to us of the social and economic growth and development of the country (Richardson, 2015). Unemployment in Australia caught everyone’s attention when the figure of the unemployed crossed a million in the year 1993. The situation of the country and its labor market has not improved ever since. Although the figure has seen a reduction in the following years, it has been fluctuating and lingering near that figure only. In this essay, we aim at analyzing the unemployment statistics and the situation for the Australian population (ABS, 2014). We have tried to explain the concept of unemployment as defined by various political and on-political organizations and studied the trends of unemployment in Australia in the past five years. We have further studied the trends and forecast for the coming years and the factors that impact the rise and fall of unemployment rates in a country and specifically studied these factors in Australia. We have analyzed these figures and drawn conclusions about the unemployment situation in Australia and also understood how unemployment is also a challenge for the governments and economists world over (Australian Government, 2016). We have also evaluated the impact of unemployment on the national economy and the growth and development of the nation. Unemployment has been a major issue of concern for all the countries and impacted the economic growth and industry specialists have given various methods to control and minimize unemployment in the countries and recommended solutions for the unemployment problem in the country of Australia (Fahrer & Heath, 1992).

The problem of unemployment in Australia is grave and all the leaders have raised their concern about this. The country’s unemployed population is on a rise and there are few jobs available for them. Unemployment is a situation when a person is willing to work and there is no jobs available in the market. Unemployment affects the county in more ways than one ad this has been established a number of times. Some of the effects that are most prominent and commonly linked directly to unemployment of a country are given in this section.

Unemployment in Australia: Current Figures

The concept of unemployment is definitely not easy to explain. The figures of unemployed people in a country at any given time is the total number of people without a job who are looking for one. It does not include the people who are mentally or physically challenged, the children and the retired population. The main cause of unemployment has always been the economic condition and growth of the nation, however, it is not limited to this. There are numerous other contributing factors to national unemployment (OECD, 2012). These include technological advancements that render the people unemployed with machines replacing them and delivering better quality work. Specialization of the jobs in the job market. The organizations seek specialized skills for the positions  and the people fulfilling all these criteria are very few. The organizations are also trying to cut down their head count by hiring fewer people to reduce their operational costs. Another quiet important factor playing a part in the employment statistics of a nation is voluntary unemployment. Sometimes people voluntarily choose not to work and this also increases the number of unemployed people in the country.

The nation has to suffer and pay the cost of unemployment. The government pays for the benefits received by the unemployed and the longer they are without work, more burdensome they are for the government. This leads to not only loss of resources and capital, but also costs the government additionally.  The ability to spend reduces for an unemployed person drastically. The person and family of the unemployed begin saving for the future and spend less impacting the national economy once more (Loundes, 1997). The employed population has to also bear the brunt of this as the increased burden on the government falls on them later on in the form of increased taxes and social security. The spending power of the employed too falls due to the increased expenses. This may lead to a financial crisis like situation and the economic slowdown of the national economy.

Apart from the financial impact, the unemployment rated also affect the nation and its social health. Unemployment has been directly related to the percentage of crime in the city and correlation has been established between the two. This is the reason why the state of Townsville, which has the highest unemployment rate among all the states also has the highest crime rate. The society having high unemployment rates is reported to rate low on the level of happiness and satisfaction. The widespread despair and depression leads to lowering the life expectancy in the long run. The mental health of the citizens worsens and there is hopelessness, frustration and low self-confidence registered with the society. This also leads to an increase in the health issues and lifestyle diseases (Carvalho, 2015). The negative condition in the society leads to political tensions and issues as well. The government has to make some tough decisions and the revenue has to be generated by increasing the taxes being charged. This makes the employed citizens frustrated and discontent from the government. The currently employed also feel unsafe in their work due to increased unemployment rates. The cases of suicide also reportedly increase in the society where the percentage of unemployment is rising. The Australian government must take suitable actions and study the reason why, despite the steady increase in national income of the country, the unemployment rates have not shown much improvement.

The employment gaps are viewed in a negative light and the situation gets further complicated due to this. The people lose their skills and the ones they know get outdated with time. The standard of living of the entire nation observes a dip and the income of the employed people is mostly spent on taxes or is saved for a future contingency (Debelle & Vickery, 1998).

The studies reported a fall in the unemployment rates in Australia. The Australian economy added close to 37,400 jobs in the labor market of Australia. This led to a decrease in the unemployment rates of from the earlier rate of 5.9 percent to the present rate of 5.7 percent. The number of people unemployed in the Australian job market witnessed a drop of about nineteen thousand. If we calculate the average unemployment rate of the country since the statistics are being maintained, we will see that the current percentage is lower than the average. This is a positive sign for the country. The average unemployment rate comes out to be about 6.9 percent which is alarming. The highest rate of unemployment rate ever recorded was in the month of December of the year 1992. It was registered to be 11.2 percent. On February 2008, the nation observed the lowest unemployment rate ever at 3.98 percent. Since then the Australian job market has only seen higher unemployment rates, currently being 5.7 percent. This is the lowest it has gone in the last three months and the speculations are being made that it will plunge even more in the coming months (Wiley, 2015).

In addition to the unemployment rates, there is another figure that is calculated to understand the employment market situation and the current labor market happenings. The underemployment rate in Australia has been juts about 2% more than the unemployment rate, which is a healthy figure. The underemployment rate is the rate of people who are currently employed but looking to work for more hours. It tells a lot about the market situation of a nation. In Australia, the underemployment rate is also at a record high of 2.6% and expected to rise more. This implies that there are a higher number of people who have a job but are looking for more working hours. The long term unemployment rates have also doubled in the country with more than a million people unemployed for more than a year. This leads to skills atrophy as the technological changes and advancement render the people jobless and hapless. The longer an individual is without work, more difficult is it for them to join the job market again (Australian Council of Social Service, 2016). The long term unemployment for Australia has been rising at a pace higher than that of the total unemployment. This is a cause of serious concern for the nation. The well being index of the country has also registered a drop of about $ 1.2 billion in the last quarter. This was the third consecutive quarterly fall of the nation.  This is not a positive picture for the country (Denny & Churchill, 2016).

Another loophole in the employment rate and the figures that it speaks of is that if a person has worked for even an hour in a week, he is still counted amongst the employed. The wage growth in Australia is also at an all time low. Thus, even though the employment rates have improved in the country, the wages have not and this is not a good sign at all. Thus, to study the labor market and the employment market situation, there are more than just employment rates that a person needs. A reduction in employment rates does not present the complete picture of the market and is sometimes only an indication towards it getting worse (Skattebol, et al., 2015).

The Australian situation of unemployment should be taken with all seriousness and steps must be taken to reduce both the unemployment and underemployment rates. The biggest contributor in the  employment and development of the nation is their economic growth. A faster economic growth will result in a growth of the market and employment rates and wages will shoot up because of that. Other than this, numerous solution have been offered to curb the growth of unemployment figures, but they slow down the growth of the nation in some way or the other. One study suggested cutting down of wages and compensation to promote employment. This would only briefly increase the employment rates, but will consequently slow down the nation’s economy and its growth. The reduction in wages will stimulate demotivation among the employees and the net benefits for the county will therefore be zero. The Australian government can however work towards making the labor protection laws less stringent and intrusive (Vroman & Brusentsev, 2002). This could promote employment and give a boost to the figure of the number of people working in the country. Some other steps that can be taken are practicing early retirement, sharing of work and reduction of migration of the citizens. These methods may provide for a quick help towards making the employment figures better, but the economists do not support them much because in a way they are cutting down on the supply of labor in the Australian labor market. Work sharing and early retirement will reflect lower labor productivity and the new people hired in the place of the old and skilled employees may not be able to deliver with the same efficiency. This will lead to lower productivity and ultimately loss of the organization (Australia, 2015).

The Australian government has reduced the immigrant intake in the nation which will promote and increase local employment. However the organizations cry foul as the demand of labor in the market is higher and the immigrants are a source of skilled labor available at a lower cost as compared to the locals. Also there have been studies indicating that the immigrants contribute to the growth of the nation as a whole and they create as many jobs as they take up. This solution therefore is quashed since the immigrants and their employment status in the country doesn’t lead to a reduction in the employment rates of the country. The government must on the other hand work towards promoting the growth of the public and private sector and the entire nation. They must build the infrastructure and transport facilities to aid in the growth of the nation as numerous studies have indicated towards a direct relationship between the infrastructure and the rate of growth of the nation (Mitchell & Carlson, 2000).

Labor market programs are another way to give a boost to the employment. The regional schemes by the Australian government have in the past, contributed to an increase in the employment. This can once again be implemented to achieve the same results. Some of the successful programs that were run by the Australian government are The Regional Employment Development Scheme, Apprenticeship Training and Support Schemes etc. The Job Combat has suggested that the organizations must opt for full time long term employment as this would greatly increase the employment and future employment prospects of the employees, reduce the unemployment rates and underemployment for the nation and thus contribute to the development of the nation. Thus we see that job creation is the single most powerful solution for the problem of unemployment (Gregory, 2000). The people, the society and the industries must try to create as many jobs as possible. Self employment and entrepreneurship must be encouraged and promoted by the government and the government must take care of the wages being paid to them. The fair wages policy of Australia must always be abided by and it must also be ensured that the employees are only working for fixed working hours and are being paid for any extra work that they do. The people should be encouraged to diversify their work profiles and should be motivated to dream bigger. They must work towards honing their skills and continuously adapt to and learn the latest technologies.

Conclusion 

We get mixed reactions on studying the Australian Employment market in its statistics. While the recent increase in the employment rates is a positive sign for the national economy, the underemployment rate speak a story of their own. This essay compiles the  study of the unemployment in Australia and its impact on the national economy and growth. This essay will help the reader  in understanding the concept of unemployment and its trends and figures with respect to Australia. We have also summarized its importance and how it influences the national growth and development. Even the most developed nations have faced unemployment and it is not a phenomenon limited to the developing or economically backward nations. The economic policies of the countries are therefore formulated in a way to tackle any such situation and make the decision making during tough times easier. Chronic unemployment can affect the individuals and the national economy and it has been proved that it has begun to impact the collective wellbeing of the Australian people. The latter part of the report suggests some of the recommended remedies to improve the employment rates in Australia and the possible measures that the industries and the government can take for doing the same.

References

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