More Australian Youth Jobless, Wages Drop

Over the past couple of years there’s been a raging debate about generational inequality in Australia. On one hand you have young people angry at the lack of affordable housing, a tough jobs market, repeated federal government attempts to cut university funding and jack up fees, and a new internship program that seems designed to consign an entire generation to indentured servitude. And on the other hand you have the older Australians getting richer.

A big new report funded by the federal government and released Wednesday has confirmed that young people were right all along—things are getting tougher, and the generational wealth gap is growing. But it also shows that people right across the country, across all demographics, are struggling to keep up, news outlets reported.

The challenge now is to come up with solutions to the growing economic problems the country is facing, and push the political parties into implementing them.

Every year the Federal Department of Social Services funds the Household, Income and Labor Dynamics in Australia survey, known as HILDA. The survey itself is conducted by the University of Melbourne.

This year’s survey has attracted a lot of attention because the results are pretty depressing, particularly when it comes to young people, housing affordability and incomes.

Income Going Backwards

The biggest problem is the income. They’re going backwards. Since 2012 median household incomes have been in slight decline. Household incomes are actually lower now than they were in 2009. Even though the Australians missed the worst of the global financial crisis they are still experiencing its impact. The current period of income stagnation is a stark contrast to the healthy wage rises seen throughout the 2000s.

There are bad numbers for university graduates too. Finding a full-time job is becoming much harder. Only 17.1% of people who graduated between 2001 and 2005 were working part-time, but for younger people who graduated in 2012 and 2013 that number had risen to 25.2%.

Graduate pay has also collapsed at an alarming rate. In 2005, graduates who had been working for two years were earning $1,468 a week. But graduates from 2013 are only earning $1,023. That’s a 30% reduction.

The HILDA survey also shows that while 36% of Australians aged 18-39 owned a house in 2002, that figure had dropped to 25% in 2014. Only 2.4% of people between 18-24 and 19.9% of 25-29 year-olds own a home. The average home debt has also doubled between 2002 and 2014.

More and more young people are now living with their parents; to be exact, 48% of women and 60% of men aged 22-25. The housing crisis is now seriously messing with people’s ability to get laid!

Older Getting Richer

While incomes are stagnating and house prices are skyrocketing there’s one demographic that’s done very well in the past decade: old people.

Between 2010-2014 the net wealth of every single age group has declined, except for people aged 65 and over. The net wealth of older Australians has increased by more than 50%.

According to Roger Wilkins, the director of the HILDA survey, the median net wealth of people over 65 is now 4.5 times the net wealth of people aged 25 to 34. That ratio has increased from 2002 when it was just 2.8.

This means generational inequality is absolutely on the rise.

Now it is blindingly obvious that an economic problem is on the rise in this country. Overall, things are sluggish. Incomes aren’t going up, housing is becoming less affordable and jobs are becoming more precarious. These circumstances seem to be hitting young people the hardest, even those who have university degrees.

What’s the Government Plan?

There is some good news though. In recent days, both Labor and the Greens have released policies designed to tackle economic inequality in Australia, the survey said.

Labor has announced policies designed to stop businesses and wealthy individuals from minimizing their tax bill. If they seriously want to tackle inequality, they need to accept that taxing the rich and spending that money on social services, health and education is a very important step.

The good news is that most Australians support increasing taxes on businesses and the wealthy. So now it’s time to do it.

The Greens have unveiled a new housing policy to reform negative gearing and capital gains tax and make housing a less lucrative option for investors. Their policy would save the government $51 billion in lost revenue.