Although the unemployment rate is at a record low, Australia’s economy is gradually unmasking its vulnerabilities through various underlying issues that may potentially threaten the economic stability of the country.
In a few recent months, the unemployment rate in Australia has stayed slightly above 4%, which might suggest that the labor market is in good condition, according to the views of some economists. Nevertheless, their point is that this figure conceals quite a few troubles in the labor market. A significant portion of youth in Australia are either employed below their qualification level or are finding it challenging to get a consistent full-time job. The number of temporary and part-time jobs is increasing, thus creating a feeling of insecurity among those workers who have problems with long-term planning.
At the same time, the real estate market maintains a rapid upward trend fueled by the scarce supply of housing and vigorous appetites, particularly among big cities such as Sydney and Melbourne. The rapid rise of housing prices, which has become the trend, is pushing homeownership farther and farther away for more and more Australians. To a great extent, that applies mostly to the younger generations and to first-time buyers who have the hardest time catching the homeownership dream, if not giving it up altogether.
Experts caution that if the present trend of the housing prices exceeding wage growth continues, Australia would indeed be heading toward becoming more and more divided into rich and poor. Those who, already facing the challenge of the increasing rent are finding that the places to live that are not pricey are getting fewer, especially in the centers of towns and cities.
Despite the seemingly strong economy, a gap between the national economic indicators and what is actually happening in the lives of a large number of Australians is evident. The positive side of the economy—growth, job opportunities, property development—is very visible. However, average Australians living in the middle of the country are feeling squeezed and pressured by the rising cost of living and insecurity in getting or keeping a job.
According to the economists, the only way in which real progress could be made is if policy changes targeted both the quality of employment and the affordability of housing. If decisive measures are not taken, Australia faces the danger of social and economic disparities not only becoming deeper but also the latter possibly becoming a heavy burden on the descendants of future generations.
