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The Effects of Macroeconomic Conditions on the Education and Employment Outcomes of Youth

Author

Listed:
  • Nicolas Herault

    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

  • Weiping Kostenko

    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

  • Gary Marks

    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

  • Rezida Zakirova

    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

Abstract

This paper examines the impact of macroeconomic conditions on the education and employment outcomes of youths in school-to-work transition. The dataset is based on five different cohorts from the Youth in Transition surveys (YIT) and the Longitudinal Surveys of Australian Youth (LSAY) and covers the period from 1985 to 2006, which is long enough to control explicitly for both poor and positive macroeconomic conditions. The multivariate analyses show that both the unemployment rates, and to a lesser extent economic growth rates, have an impact on youths' education and employment outcomes. Although the effects vary significantly by gender an education level, overall the results reveal that poor macroeconomic conditions tend to drive young people out of full-time work and into inactivity or part-time work. In addition, poor macroeconomic conditions tend to discourage further education. A result worth noticing is that males who did not complete secondary school suffer the largest increase in unemployment risks as the unemployment rate increases.

Suggested Citation

  • Nicolas Herault & Weiping Kostenko & Gary Marks & Rezida Zakirova, 2010. "The Effects of Macroeconomic Conditions on the Education and Employment Outcomes of Youth," Melbourne Institute Working Paper Series wp2010n02, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
  • Handle: RePEc:iae:iaewps:wp2010n02
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    File URL: http://melbourneinstitute.unimelb.edu.au/downloads/working_paper_series/wp2010n02.pdf
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    Cited by:

    1. Beate Jochimsen & Christian Raffer, 2016. "Herausforderungen bei der Messung von Wohlfahrt," Discussion Papers of DIW Berlin 1595, DIW Berlin, German Institute for Economic Research.
    2. Enrico MARELLI & Elena VAKULENKO, 2014. "Youth Unemployment in Italy and Russia: Aggregate Trends and the Role of Individual Determinants," Working papers of the Department of Economics - University of Perugia (IT) 0001/2014, Università di Perugia, Dipartimento Economia.
    3. Junankar, Pramod N. (Raja), 2014. "The Impact of the Global Financial Crisis on Youth Labour Markets," IZA Discussion Papers 8400, Institute for the Study of Labor (IZA).

    More about this item

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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