More older people staying in workforce

Older people have displaced more than 40,000 teenagers from jobs in the past five years as more choose to stay in the workforce and employers shun youth for experience.

Research by the Salvation Army's social policy unit has found that the number of 15- to 19-year-olds in paid work dropped by 42,600 in the last five years, while the numbers still working beyond 65 jumped by 40,200.

Researcher Alan Johnson said employers were holding on to experienced workers past the traditional retirement age - at the expense of taking on inexperienced young people.

"There is a tight labour market, so people without skills and a work ethic are the ones that are going to be excluded first," he said.

"There is this huge increase in employment among people over 65, so employers faced with the prospect of employing someone, often for the same sort of work, who is older or a school-leaver, are possibly electing to opt for more mature workers because they are more reliable."

As a share of each age-group, employment rates fell in every five-year age bracket below 50, and rose in every age bracket above 50 despite the recession.

One in five over-65s are still in paid work - up from one in seven in 2006, while only one in three teenagers is in work.

Waikato University professor of social gerontology Peggy Koopman-Boyden said today's over-65s were "much healthier, more active and more involved" than any previous generation.

Compulsory retirement ages have also been illegal under the Human Rights Act since 1999.

"They want to work because they enjoy working, they are participating, they are involved."

Many teenagers are fulltime students who have merely lost part-time jobs. But the numbers who are not in any kind of education, employment or training (NEET) rose from 7.7% of the age-group in 2006 to 11.7% in 2009. NEET numbers have since come back halfway to 9.7%.

Mr Johnson said this was partly because a chunk of training funds was switched out of apprenticeships, other industry training and courses for disadvantaged youth, and used to boost universities and polytechnics.

Tertiary Education Minister Steven Joyce said then that much of the money going into industry training was being "wasted" because just over half of all trainees failed to earn any credits in 2009. But Mr Johnson said shifting the funding to universities meant less training for the most vulnerable.

"The Government has taken resources out of life-skills and vocational training and put it further up the ladder to the disadvantage of at-risk youth to a degree that it's a ticking time bomb," he said.

Business New Zealand chief executive Phil O'Reilly said employers were also discouraged from employing teenagers because of a 2008 law change that raised the minimum wage for 16-year-olds and 17-year-olds from 80% to 100% of the adult rate after three months or 200 hours in work.

A Labour Department study last year found this change cut the numbers of 16-year-olds and 17-year-olds in jobs by between 4500 and 9000 in the subsequent two years.

The National Party promised last year to keep the youth minimum wage at 80% of the adult rate until under-18-year-olds had worked for six months for the same employer.


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