How Australia’s labour market is leading to a surge of children with jobs

Young checkout operators are back with a vengeance as the Australian labour market drags in workers from all age groups, including schoolkids.

During our many years of rising underemployment, the idea children should work became quaint and old-fashioned. Adults took part-time jobs while the youth were coddled at home, focusing on their studies. The rate at which school students had jobs sank from 36% in 2005 to 32% by 2019.

Our roaring inferno of a labour market has changed all that. Now it will take all the fuel it can: 40% of all students aged 15 to 19 are employed, according to official ABS statistics.

Child labour is at unforeseen levels, and there are calls for kids to take on even more roles: not only former PM Scott Morrison’s brief flirtation with the idea of underage forklift drivers, but also retail requests for 13-year-olds to work in supermarkets.

The rise of the child worker is certainly helping fill some lower-paid jobs usually filled by foreign workers. Anyone who has been to a restaurant recently will have noticed the change in waiter demographics. Whereas once your default waiter was an early-20s backpacker, now it’s a Year 11 student.

Is this… good?

Even a few hours at minimum wage will help families with the effects of inflation. If kids can fund their own Starbucks frappes and Tommy Hilfiger track pants, family budgets can go a bit further.

Plus work is good for you. It teaches responsibility and builds a CV. A kid who takes an entry-level job in Year 9 can apply for roles that require experience by Year 10, gaining higher pay and more responsibility.

Earlier involvement in the labour market is also likely to generate lifelong employability benefits, according to Australian research from 2003: “In comparison with those who do not work during high school, participating in part-time work increases the odds by 65 percentage points of gaining an apprenticeship rather than being unemployed. Similarly, for those who work during school, the odds of gaining a full-time job rather than being unemployed are increased by 46%.”

Education hit

However, working a job while at school isn’t necessarily good for your education. Plus education also generates lifelong employability benefits, and working lots of hours as a teen correlates with dropping out of school, the same research finds.

“Males who work five to 15 hours per week during Year 9 are approximately 40% less likely to complete Year 12 than those who do not, while males who work more than 15 hours per week (up to and including full-time work) are approximately 60% less likely to complete Year 12,” the research found.

It makes sense that if you’re pulling long shifts at Macca’s serving the drive-through, you do less homework and perform worse at school. But it could also be the case that kids who plan to quit school do more part-time work. So causation is not necessarily as straightforward as it seems.

At any rate, as the next chart shows, doing more hours of work in Year 12 is correlated with getting a lower university entrance ranking, according to data from the longitudinal study of Australian youth.

What will become of them?

So will the current student cohort, highly employed from a young age, do better or worse in their lives than those less employed and more devoted to their studies? The data will be fascinating to collect, because it will help answer the question of whether our society’s growing investment in education is truly worthwhile, or just filling in the gaps created by weak labour markets.

A job you could once be hired for after completing Year 12 now asks for a master’s. Is that qualification necessary to do the job, or is it just “credentialism”, a way of signalling the commitment of the applicant? If it is just a signal, can we find a way to generate the signal without occupying two to three years of the young person’s life? And without saddling them with a big HECS debt?

One of the most famous proponents that education is credentialism is tech entrepreneur Peter Thiel. He made scholarships of $100,000 available to brilliant young people to get them to drop out of university and do something.

Even without a Thiel fellowship, the financial advantage of starting work at 18 is gaining experience and starting to sock away superannuation instead of building up a HECS debt. The question is whether that advantage is significant enough to be lifelong. If the labour market remains strong, we may see more employers choosing to hire people straight out of school, and we’ll find out the answer.

This article was first published by Crikey.