It is a universally acknowledged truth that the baby boomers are usually to blame for everything wrong in modern life. And while it is perhaps too early to directly blame them for the Covid-19 recession, it is certainly true that economically speaking they have recovered fastest.
Breaking down the ABS’s weekly payroll data shows that employment rates radically differ by age. Boomer’s 50 and older fully recovered their total employment levels by mid 2020 when the overall unemployment rate was still an eye-watering 7.5%. But employment of younger workers still remains far below its pre-pandemic level today.
This divergence is likely a function of the industries that employ young vs old workers. The retail, accommodation and restaurant industries still suffer from restrictions on travel and tend to hire young workers. But even if you control for their industry this disparity still exists. For example in the hard hit arts and recreation sector employment rates of people 20-29 are still 3% below their pre-pandemic rate, but employment of workers 60+ has already surpassed it. This suggests the other differences (such as having different roles within companies) between the generations is also riving the disparity
The one bone that the government has thrown to younger workers is the JobMaker program in last October’s budget. JobMaker is a direct hiring credit for young workers, with businesses hiring new workers in their 20s receiving a credit of $200 per week subsidy and $100 per week for those workers 30-34.
Zooming in on the workers affected gives us a hint that this scheme may be having some success. Since its implementation in October employment for people in their 20s has grown twice as fast as those workers who are on the wrong side of 35 and are thus ineligible. Workers in their early 30s, who qualify for a half subsidy have seen employment growth in between the two.
Given the age-based cutoffs I am sure some smart economists are looking at the microdata of the labour force survey as we speak to measure the effect of the subsidy in detail, so watch this space!