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Generational crises or unemployment problems?

The Treasury and Productivity Commission warn us constantly about our gloomy demographic future due to the fact of population aging. The view is that no one wants to work until they are 60 and, because of low fertility rates, there are too few kids to support the aging population. Right? No wrong! Lots of economists have long-argued that such fears are exaggerated.

Tim Colebatch in The Age this morning confirms that Aussies are not in fact retiring earlier. The gloom and pessimism of the Treasury and The Productivity Commission is unwarranted. Early observations of falling retirement ages seems to reflect the effects of earlier recessions not the desire of lazy Aussies to exit the workforce.

Of course unemployment remains a devastating feature of the Australian economy with 14% of men aged 25-54 having no job and 31% of women. And numbers no longer looking for work have doubled. Quote:

‘Just 465,000 Australians were officially unemployed, but 322,000 were working less than 15 hours a week and wanted more work – while almost 1 million more were jobless and would like to work, though few were looking.

Why not? Of those not seeking work, one in four were carers, mostly full-time mothers. Another 13 per cent were studying, and 9 per cent were sick, injured or taking a holiday. But 10 per cent said employers saw them as too old, and 8 per cent said there were no suitable jobs.
Among the 627,000 trying to find more work, the problems were sharper. One in three said there were too few jobs or too many applicants. Another 17 per cent said they lacked the skills or experience they needed, and 13 per cent said employers don’t hire people their age’.

The skills crisis is real and needs to be addressed by focusing on those at-risk individuals who run the risk of going through life without having a steady job. Deal with that and, according top Colebatch, the ‘aging-workforce’ problem will disappear.

Colebatch has written on this issue several times before. For example, here.

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