The canary is getting louder
Young people who can't find work usually show up first in the labour data, and that's the warning here. Youth unemployment has risen again, and economists are asking whether it has further to go as the economy softens.
Start with the gap. Australian Bureau of Statistics data from September put youth unemployment at 11.1 per cent, against an overall rate of 4.7 per cent. That's a wide gap, and it tends to widen when the economy slows. Youth unemployment is still below its pre-pandemic level, which buys some room, but that cushion is thinner than it looks.
Blair Chapman, chief economist at jobs website SEEK, puts it bluntly: "We tend to see younger workers affected more heavily when there is a slowdown." Commonwealth Bank economist Harry Ottley goes further, saying the youth rate is "definitely rising more quickly than other cohorts."
*Lachlan Riddell says he has applied for hundreds of jobs over the past three years. (ABC News: Kate Nickels)*
Hundreds of applications, very few replies
Statistics only tell part of the story. Lachlan Riddell, 24, has applied for hundreds of jobs over three years, from collecting supermarket trolleys to retail and hospitality roles. He calls what he's going through "job hunting depression." "I started to fall into a bit of a slump, [asking myself], 'why am I even doing this'," he said.
Riddell holds a Diploma of Music and works casually as an audio-visual technician. The shifts are sporadic. Despite wide-ranging experience, he rarely hears back, and most of the applications he sends go through online portals. That's where his frustration sharpens: "I've seen a lot of companies now use AI for their job hiring process. I'm not even talking to a real human."
*Lachlan Riddell says without a permanent job, he's struggling to make ends meet. (ABC News: Kate Nickels)*
His worries go past automation. He suspects that in Tasmania's small jobs market, who you know matters more than what you know. And he's blunt about money: he's getting by on Jobseeker and leaning on support from his fiancée. "It's pretty hard financially to survive."
He also rejects a common stereotype. "I feel like there is a mentality that … generation Z don't want to work, that they're very selective about what they want to do, which is simply not true," he said. Riddell's experience points to a different problem. Candidates are getting filtered out long before a person reads the application.
*Lachlan Riddell has applied for jobs, including in hospitality. (ABC News: Sam Ikin)*
Fewer graduate roles
Graduate job ads have been sliding from their post-pandemic highs, according to SEEK. Chapman says there's "anecdotal evidence that several larger firms have reduced their graduate intakes in recent years," and he points to the big four accounting firms as an example. They cut intakes in response to falling demand.
Chapman expects demand for graduates to keep softening in Australia as the economy weakens. If he's right, the students finishing degrees now could face a thinner pipeline than the cohort before them. That's why the advice to engage with the job market well before graduation carries more weight than it used to.
*Blair Chapman says the number of graduate jobs has been trending down. (ABC News: John Gunn)*
Not all bad news
And yet the picture isn't simply grim. Youth unemployment is rising alongside continued job growth for young people, and that combination is easy to misread. Ottley's read is that more young people are entering the labour market, not that jobs are disappearing.
The numbers back him up. The employment-to-population ratio for young people is 63.6 per cent. That's down from a peak of 66.7 per cent in November 2022, but well above the 2019 average of 59.7 per cent. Youth participation is 71.4 per cent, compared with 67.7 per cent in 2019.
"So more young people are in the labour market looking for work," Ottley said.
That's the mechanism to keep in mind. When more people are looking for work than there are openings, unemployment climbs even if employment is growing. It's a healthier kind of problem than falling employment, but it's still a problem for the person without a shift.
*Harry Ottley says there are more young people in the labour market looking for work. (Supplied)*
AI, second jobs and a narrower runway
Fears of an AI jobs apocalypse, particularly for young people and white-collar workers, are everywhere. The evidence so far is more measured. A study by the [Department of Employment and Workplace Relations](/news/2026-07-08/government-report-finds-ai-not-yet-causing-mass-job-losses/106889304) found the technology was not yet causing broad disruption to Australia's labour market.
The study, released in July, found jobs for people aged 20 to 24 had grown slightly faster than jobs for those 25 and over since ChatGPT arrived, and young graduate outcomes had held up. But it didn't close the case. It cited US evidence showing young people's employment growth has lagged older workers since generative AI tools arrived, especially in occupations more exposed to AI. That's the finding to watch. Aggregate numbers can look fine while the entry-level door quietly narrows.
Corporate announcements make that risk harder to dismiss. Qantas last week announced [850 job cuts and plans to accelerate its use of AI](/news/2026-11-10/850-jobs-to-go-from-qantas-as-airline-moves-roles-overseas/107368120).
*Qantas is cutting jobs. (ABC News: Evelyn Manfield)*
Ottley expects some disruption, though not a wholesale one. "We do think there'll be some job disruption at the margin, let's say, over the next five years," he said.
Federal Skills and Training Minister Andrew Giles argues AI is mostly augmenting jobs, "so changing the way in which a job is done rather than completely automating a job." "We've got to really focus on our skill to make sure workers are equipped to manage this transition," Giles said.
Young job seekers also face growing competition from people who already have jobs. One million people in Australia hold multiple jobs, and those workers are increasingly going after the same roles. Giles said it's important young people understand where opportunities are and which sectors have vacancies.
That advice is sensible. The catch is that a 24-year-old sending application number 300 into an online portal can't see where the vacancies are. Until hiring becomes more visible and less automated, telling young people to find the right sector puts the burden on the people with the least leverage.
