So we can safely predict this National govt will score it’s usual epic fail around youth unemployment. And we all know the reasons why this is such a critical issue, so I’m not going to re-hash them either. It’s just that both sides in this debate keep missing the crux of the matter… what is needed to create those crucial first career defining, work-habit forming steps in a young person’s working life.
Well there are only two ways for government to do it:
Directly step into the market with public sector entities like the NZR, Post Office and MoW of olden days. Sadly I think this powerful option has been stolen from us, at least in the near-term.
Or indirectly act through the private sector; which is the realistic option open to us. The type of job a young person steps into, with qualifications but little experience is entry-level by definition. The private sector can only support a limited number of such roles. No company owner can afford the cost or risk of having too many inexperienced staff with marginal productivity. Many SME owners understand the need to give young people their start in life; but even in ideal times, their business has a strict upper limit to it’s capacity to do so.
But the number of jobs is only one dimension of the job market. The rate at which they turn over is the other crucial parameter. Every time any person moves jobs, they are creating a new vacancy immediately behind them, a vacancy that will most likely be filled by someone looking for the next step in their career too. Which may well repeat as a chain reaction right down to the entry-level.
Now the this ‘employment chain’ is stochastic, ie it’s impossible to predict in advance exactly what the sequence of ‘employment movements/promotions’ in the chain will turn out to be. Some chains might be only one or two movements long, others might meander on almost indefinitely. Nor can the dynamics of it be predicted; some vacancies in might filled in days, others might take months. But clearly the more people frequently people jobs at any point in their career paths, the more probable jobs at the career entry-level will open up as a result.
In other words the high youth unemployment we are experiencing is not so much the consequence of low or zero growth, but relatively low levels of employee turnover at all levels. And right now the most ‘stuck’ workers of all are skilled technical and professional people over the age of 50.
There are several reasons for this. One is that we are the boomer generation and there’s just too damned many of us competing for too few promotion opportunities in workplaces that are too damned small. And we’re generally too competent and productive to waste on internal promotion into management anyhow. Moving to a new employer we face the huge hurdle that no-one wants to interview anyone over the age of 50. (Mainly because we’ve seen through all the varieties corporate bs already and don’t tolerate it very well; young kids are more pliable.)
And yet the scary fact is that fully half the skilled technical people in this country are over the age of 55 and will be mostly retired within 10-15 years. Ask any of them… there are simply not the young people coming through to replace that cohort of critical skills. (Not carefully: while unemployment is staggeringly high, employers constantly whine about a lack of skilled staff. This is why.)
These two critical problems of youth under-employment and skilled worker over-employment are directly linked. Governments could the fix the first problem by directly subsidising employers to take on entry-level workers; but thats like trying to blow air down straw with kink at the other end of it, no matter how hard you puff nothing much changes.
You get people moving through their careers by exploiting the ‘employment-chain’ effect described above, and getting those ‘stuck’ older skilled workers moving again. Unblock the straw and it’s easy. Here’s just a few obvious ideas how:
Drop the insane 90 day ‘fire at will’ law. Whatever flimsy justification it ever had is utterly nuts when applied to mature, experienced workers. We’ve been working for 30 years ffs.. we have a substantial employment record on our CV that can be referenced. And at our late stage of life we are hugely averse to taking the risk of trying new job that doesn’t work out… bad enough for a 20yr old, catastrophic at 55.
Change the tax rules to encourage companies to create new senior’development’ roles in parallel with managment whose specific task is to plan and develop the technical capacity of their organisation and the wider industry.
Hugely beef up Industry Training Organisations; not just in terms of training apprentices but people in careers at ALL levels. Far more mandatory participation from the private sector; get senior people with decades of experience sitting around tables thrashing out Codes of Best Practise, new Standards and White Papers …alongside tertiary sector researchers and public sector regulators. It’s slow, frustrating, curse-making work, but you build your industry, you create people with capacity to take NZ to the world.
And some older folk are sick of working 50+ hour weeks with failing eyesight, or a memory that isn’t so sharp anymore. Generate more flexible options around Superannuation. Allow people to claim partial super from the age of 55 in return for working less than 40 hour weeks.
In return for this investment of public money you achieve three crucial things; build industry capacity, directly mitigate a looming skills shortage, and get the ‘employment chain’ moving again… indirectly getting young people into those entry level jobs most of them are so keen to find.