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Youth unemployment and the retail industry

June 23, 2016

Throughout the current federal election there has been a consistent focus on jobs creation, and how more Australians can be assisted into the workforce.

As part of this discussion, there has been a particular emphasis on jobs for young people, and what initiatives will best address the current issue of youth unemployment across Australia.

The concern surrounding young people and work is important, especially given that the employment prospects of young people have been most directly impacted by the challenging labour market conditions across the past five years.

At present, almost 260,000 young Australians, aged between 15 and 24 are unemployed, and while this has fallen from the peak of more than 290,000, which was recorded in November 2014, this particular age group continues to be the most likely to be without work.

Given that the total pool of unemployed people in Australia is approximately 724,000, more than a third (35.7 per cent) of all people that are presently without work are aged between 15 and 24 years.

As indicated in the chart below, young people (15-24 years) have experienced particular challenges following the global financial crisis, and continue to struggle in the current employment environment.

Source: ABS, NRA

Youth unemployment is of particular importance to the Australian retail industry, given that businesses within this sector of the economy have always performed a key role in assisting young people achieve an entry-level job, and get started in the world of work.

Indeed, retail continues to be the industry most likely to employ a young person, and has a key role to perform in developing the core employability skills of each generation.

At present, retail businesses are the largest employer of young people, with the industry having approximately 422,000 team members aged under 25 years, which accounts for almost one quarter (22.5 per cent) of the entire youth workforce in Australia.

Given the importance of young people to the retail industry, the National Retail Association (NRA) supports initiatives that assist youth make a smooth transition into the workforce, and in particular, endorses the application of high quality vocational education and training to develop individual skills.

Research suggests that providing young people with access to this type of learning produces less polarised outcomes, especially for those not wanting to pursue an academic pathway beyond high school.

While training is an important mechanism in assisting young people transition to work, support from the whole industry is also essential, and in particular, the NRA encourage employers, when it is possible, to provide work experience and on-the-job training to young people.

Evidence suggests that early exposure to the workplace, through high quality work experience, does improve the likelihood of young people establishing themselves in the workforce. Essentially, these opportunities provide an opportunity to learn and apply the key employability skills that business owners want from a prospective team member.

This is supported by research conducted by the NRA that indicates many retail businesses would be willing to employ young people if they had a better understanding of the industry, the sales process, and the specific roles and responsibilities of working in a store.

As this suggests, if young people are given the opportunity to develop employable skills through work experience and on-the-job training, it will improve their job prospects and likelihood of being employed.

A key element however, is the availability of employers to perform a role in providing guidance, and insight, through work placements.

For this reason, it is important to highlight that the benefits of work experience are not one-way, with employers also receiving a number of positive outcomes from this strategy. In particular, work experience is an excellent recruitment strategy for retailers, and in an industry that has high turnover of casual staff, it can minimise the cost and time of recruiting new employees.

The NRA suggests that improved support, which will enable engagement with employers across the retail industry, is a component that is currently missing from the youth employment discussion and is keen to receive feedback from members in relation to this issue.

To further discuss the work experience, and on-the-job training activities within your business, please contact Yvonne Williams, Director – Training & Industry Projects, on (07) 3240 0100, or by email.

Cameron Meiklejohn, Industry Research and Data Analyst

NRA Media

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