Young Australians Overqualified and Underemployed

An annual study into how young people are faring in Australia reveals a misalignment between the skills many young people have and the jobs that are available to them.

The report by the Foundation for Young Australians (FYA) has shown that many young Australians are overqualified for their jobs and those without qualifications are finding it much harder to get a good job.

The report found that 26 per cent of Australian higher education graduates are underutilised immediately after course completion and 15 per cent are still underutilised three years later.

Only around one-third of VET graduates are employed in the same occupation as their field of training.

At the same time, however, 28 per cent of Australian employers have said they would have recruited more graduates had there been candidates with appropriate skill sets.[1]

“Addressing the mismatch between young people’s skills and the needs of the labour force requires a rethink of careers education in schools,” Associate Professor Lucas Walsh from the Faculty of Education at Monash University and FYA’s Senior Research Fellow said.

“We need to show young people the different pathways that are available and give them more information on where those pathways lead.”

Associate Professor Walsh also noted a growing awareness of young people who may do well in school but do not leave with the competencies, motivation and predispositions to become active, self-directed learners post school.

“This is salient given that more young people than ever are completing high school – we need to ensure they’re leaving with the skills they need to adapt to our rapidly changing workforce,” Associate Professor Walsh said.

“On the other hand, those without post-school qualifications are increasingly at risk of being marginalised from getting good jobs, so we need to provide ways of keeping them engaged in study and training.”

Other findings include:

• 75 per cent of teenagers (15 to 19 year-olds) and 32 per cent of young adults (20 to 24-year olds) are in full-time education.

• The unemployment rate for teenagers is 17.7 per cent and for young adults it is 8 per cent.

• The underemployment for 15 to 24 year-olds is 12.6 per cent; for the whole population it is 6.9 per cent.

• The underutilisation rate for 15 to 24 year-olds is 23.7 per cent, compared to 11.9 per cent for the entire labour force population.

• 20 per cent of all casual workers are aged 15 to 19.

How Young People are Faring 2013 also examines the nature of young people’s jobs and the broader social context for young people, including trends in independence, marriage, fertility, home ownership and life satisfaction.

Other key findings include:

• Rates of participation in formal education and training continue to increase.

• While there have been some improvements, young people in remote locations and Indigenous young people continue to experience far lower education and training achievement, compounding their disadvantage in the labour market.

• Young Australians are faring relatively well in education and employment compared with other OECD countries.

• Young people who have obtained a post-school qualification have a strong chance of getting a “good” job compared with the rest of the workforce. However, young people without post-school qualifications are more likely to be trapped in low income jobs.

• Life transitions such as independence from parents, marriage, starting a family and owning a home are being delayed as young people participate more in education and are less able to obtain full-time work.

• The proportion of young people who are very satisfied with life has increased over the past decade.

How Young People are Faring 2013 is available at www.fya.org.au.