Why is it that some areas suffer from higher levels of youth unemployment than others? One European country that bucks the trend has some lessons.
Australia’s youth unemployment hotspots were revealed earlier this year in a Brotherhood of St Laurence report that analysed ABS labour force survey data. It showed that in four regional areas, the number of young people out of work hovered above 20 per cent. The worst performer – in the outback of Queensland and including the mining centre of Mount Isa – the rate reached 28 per cent. This compares to the national youth unemployment rate of 15- to 24-year-olds, at 12.2 per cent.
While these figures are troubling, the eurozone, where youth unemployment is running at just over 21 per cent, would gladly swap places with Australia. However, one region – Bavaria in southeastern Germany – bucks the trend. Earlier this week, The Guardian newspaper dug deep to find out why.
The largest state in Germany by land mass and the second most populous, Bavaria has a youth unemployment rate of 3.4 per cent – the lowest in the entire eurozone. Like other eurozone countries, Germany has an ageing population, but Bavaria has the highest number of 15- to 24-year-olds in residence.
Focussing on Freising, a district of Upper Bavaria containing Munich’s airport, The Guardian’s report reveals a broad mix of industries ranging from service-sector jobs to car manufacturing. Most are medium-sized companies, employing less than 100 employees and many are also family-run businesses.
A local job agency owner is quoted as saying that it leads to a culture where employers “care whether you turn up to work on time, but they also stand their ground and stick with their workforce when the economy hits the buffers for a while.”
A shortage of talent also means that businesses have to go that extra mile to attract staff. Theresa Fleidl, the head of HR at Munich airport, says that it is the only airport in the world with its own brewery and indoor wave-riding pool. “We want to offer our employees a world full of experiences,” she says.
Germany’s youth also benefits from specialist vocational schools for the training of apprentices – a responsibility cost shared with employers. In Upper Bavaria, these schools are thriving and growing. Instead of opting to attract qualified workers from outside the region, companies are training and moulding locally based workers to fill the jobs they need.
“In other parts of Europe, the state tries to push everyone into university, and you end up with doctors driving trucks,” Fleidl told The Guardian. “Here, we get the companies to educate their employees, and they can get exactly the workers they want.”
It’s Germany’s approach to apprenticeship training that is particularly instructive for Australia, where the numbers of people beginning an apprenticeship has slumped by 20 per cent in the past year. Apprenticeships in non-trades training – including retail, clerical and hospitality – have been in long-term decline.
While business leaders have been quick to express alarm and warn of skills shortages, none are suggesting that they might take some responsibility for training young workers themselves.
Greater education and awareness around apprenticeships would also help to redress the deficit. Research in Australia has shown that many young people are unaware of opportunities available to them when pursuing a traditional trade – and there is an image among young people and their parents that the trade pathway is primarily for non-academic males.
Increasing participation from young women, Indigenous Australians, and those of varied ethnic background could help to reduce unemployment among those groups and address skills shortages at the same time.