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The impact of the Global Financial Crisis on youth unemployment

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  • PN (Raja) Junankar

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.

Suggested Citation

  • PN (Raja) Junankar, 2015. "The impact of the Global Financial Crisis on youth unemployment," The Economic and Labour Relations Review, , vol. 26(2), pages 191-217, June.
    • Handle: RePEc:sae:ecolab:v:26:y:2015:i:2:p:191-217
    DOI: 10.1177/1035304615580536
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    References listed on IDEAS

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    Cited by:

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    3. João Carlos Lopes & João Ferreira do Amaral, 2017. "Self-defeating austerity? Assessing the impact of a fiscal consolidation on unemployment," The Economic and Labour Relations Review, , vol. 28(1), pages 77-90, March.
    4. Vespignani, Joaquin L. & Yanotti, Maria Belen, 2020. "COVID-19 and Tasmanian Youth Unemployment: A Policy Recommendation," MPRA Paper 101158, University Library of Munich, Germany, revised 2020.
    5. João Ferreira do Amaral & João Carlos Lopes, 2016. "Self-Defeating Austerity? Assessing the Impact of Fiscal Consolidations on Unemployment," Working Papers Department of Economics 2016/13, ISEG - Lisbon School of Economics and Management, Department of Economics, Universidade de Lisboa.
    6. Brendan Churchill, 2021. "COVID‐19 and the immediate impact on young people and employment in Australia: A gendered analysis," Gender, Work and Organization, Wiley Blackwell, vol. 28(2), pages 783-794, March.
    7. Zamanzadeh, Akbar & Chan, Marc K. & Ehsani, Mohammad Ali & Ganjali, Mojtaba, 2020. "Unemployment duration, Fiscal and monetary policies, and the output gap: How do the quantile relationships look like?," Economic Modelling, Elsevier, vol. 91(C), pages 613-632.
    8. Junankar, Pramod N. (Raja), 2019. "Youth Labour Markets in Developing and Developed Countries: The Role of the Sectoral Composition of Production," IZA Discussion Papers 12256, Institute of Labor Economics (IZA).
    9. Nikica Mojsoska-Blazevski & Marjan Petreski & Marjan I Bojadziev, 2017. "Youth survival in the labour market: Employment scarring in three transition economies," The Economic and Labour Relations Review, , vol. 28(2), pages 312-331, June.
    10. Danielle Venn, 2018. "Indigenous youth employment and the school-to-work transition," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 21(3), pages 209-227.

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    More about this item

    Keywords

    Youth unemployment; Global Financial Crisis; minimum wages; replacement rates; youth labour markets;
    All these keywords.

    JEL classification:

    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

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