Dene Mackenzie in the ODT reports:
BNZ economist Stephen Toplis wants the Government’s policy-makers to get a better understanding of the way the nation’s labour market is working.
“There’s a lot of wild and woolly stuff going on that is raising significant question marks over whether the necessary labour supply is available to meet New Zealand’s ongoing growth needs.” Policy-makers at both Treasury and the Reserve Bank would need a deep understanding of the labour market to set the ground rules, he said.
There had been a disproportionate rise in the nation’s youth unemployment rate for workers aged 15 to 19 years, which was now a “staggering” 27.5%, and the next age group – 20 to 24 years – had a rate of 13.5%.
Workers over 25 – who could be seen as a proxy for “skilled workers” – had a rate of just 4.6%, lower than the 6.3% peak level for that age group in 1998 and 8.5% in 1992.
On average, the youth unemployment rate had been 11.8 percentage points higher than the non-youth rate since 1986, but by March this year that difference had climbed to 21.9 percentage points.
So what happened? Labour and Greens got rid of youth rates, and National has not put them back.
Between the peak in youth employment at the end of 2007 and now there were 50,500 fewer workers in the 15-19 year age group, a fall of 31.6%, even though there had been an increase of 2400 in the total number of people employed.
“The oldies are on the march … it’s an oldies takeover.”
Youth rates were abolished in 2008, and there are now 50,000 less teenagers in work. This might be the worst case of putting ideology over pragmatism we have seen in terms of adverse consequences.