Young Australians Flood Job Market as Teen Underemployment Plunges
15-19 year olds see underemployment drop 2.1 percentage points in single month
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Australian teenagers experienced a dramatic improvement in job quality in December 2025, with underemployment among 15-19 year olds plunging 2.1 percentage points to 17.4 per cent—the sharpest single-month decline for that age group in recent ABS records. The shift suggests employers are offering more hours to young workers rather than keeping them in precarious part-time arrangements.
The Australian Bureau of Statistics released the December labour force data Thursday, highlighting unusual strength in youth employment. “Fewer young people were underemployed in December, with the 15-19 year old underemployment rate falling by 2.1 percentage points to 17.4 per cent,” said Sean Crick, ABS head of labour statistics. The national underemployment rate fell 0.5 percentage points to 5.7 per cent overall.
Underemployment measures workers who are employed but want more hours than they’re getting—a chronic problem for younger Australians juggling school, entry-level jobs, and the rising cost of living. For teenagers, underemployment typically runs far higher than the national average because casual retail and hospitality jobs dominate youth employment, and these sectors often limit hours to avoid benefits obligations or manage unpredictable customer demand.
The December figures show 15-24 year olds as the primary drivers of both employment growth and improved job quality. While overall employment rose 65,000, the ABS specifically noted younger workers “moving into employment” as the key factor. The combination of more young people getting jobs and those already working getting more hours marks a significant tightening in the youth labour market.
Male underemployment fell more sharply than female underemployment across all age groups, dropping 0.8 percentage points to 4.6 per cent for men compared to a 0.1 percentage point decline to 6.9 per cent for women. This gender disparity mirrors the broader employment growth pattern, where male employment rose 49,000 versus 17,000 for females.
The data doesn’t reveal which industries expanded hours for young workers, but historically, improved teen underemployment correlates with growth in retail, hospitality, and warehousing—sectors that employ large numbers of younger workers. The survey period (November 23 to December 6) preceded Christmas but captured potential early holiday season hiring, though the ABS applies seasonal adjustments to account for predictable patterns.
The underutilization rate—which combines unemployment and underemployment to show total slack in the labour market—fell 0.7 percentage points to 9.8 per cent, its lowest level since mid-2023. The sharp drop indicates the labour market is genuinely tightening, with fewer people either jobless or stuck in inadequate part-time work.
What remains unclear is whether December’s youth employment gains will persist. Seasonal employment often spikes in November-December before collapsing in January-February as temporary retail and hospitality workers are let go. The detailed labour force data due January 29 will show whether young workers found permanent positions or are clustered in temporary arrangements vulnerable to economic downturns.
The trend underemployment rate remained at 5.9 per cent in December, unchanged throughout 2025. Trend data smooth out monthly volatility, and the fact that trend underemployment stayed flat while seasonally adjusted figures dropped suggests economists should wait for additional months before declaring a sustained improvement in job quality for young workers.
What both sides agree on: Underemployment fell sharply in December, particularly for younger Australians, indicating improved job quality.
Why this matters to Gen Z and Gen Alpha: If you’ve been trapped in a casual job begging for more shifts while your manager claims “business is slow,” December’s numbers suggest the power dynamic might finally be shifting. A 2.1 percentage point drop in teen underemployment in one month is massive—it means hundreds of thousands of young workers either got more hours or moved into better jobs. This could translate to actual financial stability instead of constantly trying to patch together rent money from three different gig-economy apps. However, the gender gap in these improvements (men benefited far more than women) and the question of whether these gains survive past holiday season means you shouldn’t quit your backup income sources just yet.
Next steps depend on January’s employment data (due late February) and whether underemployment continues falling or bounces back. If the trend holds, young workers might finally have leverage to demand better scheduling, higher wages, or benefits from employers who have spent years treating youth labour as infinitely replaceable.
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