National report card details Australia’s labour market, welfare spending and home ownership

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Southbank, Victoria, Australia
A recent study found there has been a 42 percent rise in failure rate across the nationwide startup sector. Mike Wilson/Unsplash

A national report card released by the Australian Institute of Health and Welfare (AIHW) on Thursday found that it was becoming tougher for young people in Australia to get full-time work when they graduate. Meanwhile, welfare spending has risen and home ownership has dropped.

The new data suggests that some Aussies are struggling to find full-time work. Australia ranks third-highest in the OECD for part-time employment.

Nearly one third of people here are working part-time hour, a significant rise from 10 percent five decades ago. Economist Jason Murphy mentioned a phenomenon called “degree inflation” where people keep studying to look more qualified than others.

Welfare spending

Welfare spending across the country has risen by $40 billion in almost a decade. It currently accounts for a larger slice of the Australian economy.

The Commonwealth, state and territory governments spent more on welfare cash payments and services in 2015-16. About $157 billion was spent during the said timeframe, which can be compared to $117 billion in 2006-07.

This means welfare spending accounted for 9.5 percent of gross domestic product. It was sitting at 8.6 percent one decade ago. The number of people employed in the welfare workforce also increased, with an estimated 478,000 people in 2015, a rise of 84 percent since 2005.

Home ownership

The report also found that home ownership among young Australians has dropped by more than one-third in more than two decades. The findings come amid Reserve Bank’s relatively low interest rates.

In past decades, home ownership rate has been declining. The proportion of Aussies who have their own properties fell from 71 percent to 67 percent, with people aged 25 to 34 among the hardest hit.

For many, using mortgages has been the key to buying property while affordability has diminished for households that rent. Assistant Social Services Minister Zed Seselja blamed the high cost of land and lack of land release in some major cities. “I think it’s fair to say most Australians would say that you know we want to do more,” he told the Nine Network.

The Turnbull government announced ways to assist young people save for their first home through their superannuation in the federal Budget. It is working with states on a new national affordable housing deal.

For aggregate home ownership rates, Australia ranks in the bottom third of OECD countries. It ranks third for homeowners with a mortgage.

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