Unstable employment while you’re young can set you up for a wage gap later in life – even if you eventually land full-time work

By Irma Mooi-Reci, The University of Melbourne

As they kick off their careers, young people often have to navigate a maze of short-term and casual jobs.

In Australia, many of them also wish to work more hours than their current jobs allow, leading to a situation called “underemployment”.

Casual employment and underemployment often go hand in hand. But just how common are these experiences during Australians’ early careers, and what effect do they have on their future wage prospects?

Setting the trajectory of young people’s careers

Early underemployment, casual employment and joblessness can greatly impact an individual’s career prospects later in life. Our 2023 study, assessing data from the Household Income and Labour Dynamics in Australia (HILDA) Survey, explored this issue in depth.

A large number of young men (22.5%) and women (19.4%) were found to have experienced underemployment when they first started their careers.

But Australian women, more so than men, endured extended and repeated periods of underemployment.

This year, we explored these trends in a further study, analysing 20 years of data from the HILDA Survey to find out the common career paths young Australians take as they start working.

We started by looking into how often young people encounter a combination of casual work, underemployment, periods of not working and unemployment in the early stages of their careers.

Our research revealed a stark reality:

• Only 44% of young workers in our study had secured permanent jobs matching their working hours preferences within five years of graduating. The more than half that remained were dealing with employment situations that fell short of their ideal.

• Of this underemployed group – the majority of whom were women or had lower levels of education – 21% were stuck in a cycle of short-term and casual jobs, and 18% experienced careers marked by periods out of work and unemployment.

Finding a stable and satisfying job early on is a steep challenge for young Australians.

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