Alexi Heazle | Indo-Pacific Fellow
The Indo-Pacific region is home to the largest number of young people in the world. An enormous 90 percent of the global youth population is concentrated in developing countries in the global south, most of these being Australia’s immediate geographical neighbours. The Indo-Pacific is home to a staggering 1.7 billion people under the age of 25, and in the Pacific, over half of the region’s total population is under 25.
In short, many nations in the Indo-Pacific are experiencing a ‘youth bulge’, a term used to describe a population phenomenon where the number of young people (defined by the United Nations as those between the ages of 15-24), make up a disproportionately large portion of a nation’s population.
In the context of the wider impacts of COVID-19, these statistics cannot be ignored. Within Australia’s neighbourhood, a key and often overlooked demographic that will be disproportionately affected by the economic fallout of COVID-19 is youth, particularly in employment prospects and education and training in both the short and long-term.
Young people have been hit hardest and fastest by the crisis, as they are disproportionately exposed to the risks and consequences associated with economic downturn relative to other social groups, especially in areas of unemployment and reductions in work hours. According to the International Labour Organization (ILO), approximately 1 in 6 people aged between 18-29 have been forced to stop working since the onset of the pandemic, and remaining employees have seen working hours cut by 23 percent.
Even prior to the pandemic, young people were already three times more likely to be unemployed than the remainder of the population – 126 million youth workers were experiencing moderate to extreme poverty worldwide. A report by the ILO states that the youth unemployment rate before the pandemic, at 14 percent, was already higher worldwide than for any other age group, but is now rising further to upwards of 20 percent. Closer to home, prior to the pandemic, the youth unemployment rate in the Pacific was estimated to be 23 percent. This has now risen to an estimated more than 40 percent in the Solomon Islands, and is expected to continue to rise elsewhere.
Young people are disproportionately susceptible to economic shocks for a number of reasons - one major factor being the prevalence of youth workers in informal employment. In the Indo-Pacific, 84.4 percent of young people aged between 15-25 work are in informal employment, compared to 68.6 percent of adults.
In usual cyclical economic downturns, the informal sector compensates for a loss of jobs in the formal sector. However, the informal sector has been hit particularly hard due to lockdowns and a decline in tourism and manufacturing. Additionally, in many nations, sectors with large and disproportionate numbers of young staff, such as retail and hospitality, have been most affected by layoffs. Further, as comparatively recent labour market entrants, youth are most likely to be laid off in restructuring processes.
Education and training
The COVID-19 pandemic is destroying youth prospects for employment, but further, is also disrupting education and training, placing major obstacles in the way of those seeking to enter the labour market, or move between jobs.
Education systems around the world have been impacted, with 191 countries implementing nationwide/localised school closures. An estimated 90 percent of students, or 1.5 billion people, have been unable to receive education in this period. These kinds of disruptions to education can negatively impact learning effectiveness, and in the long-term, graduation and employment rates.
Long-term impacts of COVID-19
High rates of youth unemployment are expected to linger and pinch for years in the Indo-Pacific after COVID-19. Both the World Bank and the International Monetary Fund do not predict quick “V-Shaped” recoveries in South East Asia and the Pacific, and most economies are only expected to return to pre-pandemic levels of GDP growth in 2022.
The ILO reports that a number of youth labour market indicators in the Indo-Pacific have deteriorated, including unemployment rates, NEET (not in employment, education or training) rates and labour underutilisation. Coupled with slowing economic activity that causes supply chain disruptions and lower consumer spending, this will severely exacerbate pre-existing issues for youth.
Why should Australia care?
Youth, which make up a significantly large portion of the Indo-Pacific population, stand to lose the most from the economic crisis brought about by COVID-19. Youth in these countries have not only seen huge rises in unemployment, but also face an uncertain economic future. They will face difficulties re-entering professional life, or even acquiring means to empower themselves through education and training.
A combination of these factors, left unaddressed, will lead to a rise in extreme poverty and fundamental instability in a large number of Indo-Pacific nations, further exacerbating already existing development challenges.
A failure by the Australian government to recognise the vulnerability of this key demographic will risk increased national instability for our partners in the region, and therefore regional instability – challenging Australia’s vision for a “safe and prosperous Indo-Pacific”. In its COVID-19 response, Australia must recognise the unique risks posed to this demographic and implement a youth focus in its short and long-term aid and humanitarian response for its key partners.
Alexi Heazle is the Indo-Pacific Fellow for Young Australians in International Affairs