The impact of the Global Financial Crisis on youth unemployment

Pramod (Raja) Junankar

The Economic and Labour Relations Review, 2015, vol. 26, issue 2, 191-217

Abstract: Australia was one of the few OECD countries to emerge from the Global Financial Crisis (GFC) without facing a recession, usually defined as negative GDP growth for two consecutive quarters. However, the (overall) unemployment rate did increase following the GFC and has still not returned to pre–GFC levels. Unemployment rates for young people went up much more dramatically and remain high. This article investigates the impact of the GFC on youth unemployment and long-term unemployment. To anticipate our results, we find that the youth unemployment rates increased significantly owing to a fall in aggregate demand, although youth wages had been falling relative to adult wages. These findings do not support the commonly heard claim that youth wages are pricing young people out of the market.

Keywords: Youth unemployment; Global Financial Crisis; minimum wages; replacement rates; youth labour markets (search for similar items in EconPapers)
JEL-codes: J21 J64 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:sae:ecolab:v:26:y:2015:i:2:p:191-217

DOI: 10.1177/1035304615580536

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