Youth unemployment is rising. What happens when young Kiwis can’t get their first job?
OPINION – The Old Hand, by Ken Franks.
There was a time when getting your first job wasn’t supposed to be complicated.
You left school, knocked on a few doors, filled in a few forms and eventually somebody took a chance on you.
You might have started stacking shelves, washing dishes, mowing lawns, working in a factory, delivering something or doing whatever else needed doing.
You weren’t expected to have five years’ experience.
You were there to learn.
That first job was the beginning of everything else.
And it is getting harder to find.
New Zealand’s youth unemployment problem is becoming impossible to ignore. The Reserve Bank says unemployment among 15 to 24-year-olds has risen to a level similar to the period following the Global Financial Crisis. It also says the ratio of job vacancies to unemployed people is around half its pre-Covid level.
The latest Stats NZ figures show 73,100 people aged 15 to 24 were unemployed in the year to June 2026, up 8600 on the previous year. There were also 94,500 young people classified as NEET — not in employment, education or training.
But the number that bothers me most isn’t the unemployment percentage.
It’s the disappearing first rung of the ladder.
Because your first job is about much more than the money.
It’s where you learn to turn up on time when you don’t feel like it.
It’s where you discover that some customers are difficult, some bosses are unreasonable and some work is simply boring.
You learn how to take criticism, work with people you don’t particularly like and accept responsibility when you’ve made a mistake.
You learn things that don’t fit neatly onto a CV.
And then you have a CV.
That’s the part we shouldn’t overlook.
If nobody gives a young person their first opportunity, how exactly are they supposed to get the experience employers keep asking for?
There is another problem arriving at the same time.
Artificial intelligence is changing the types of work businesses need people to do.
Some of the basic tasks traditionally handed to junior workers are increasingly being automated.
That raises an uncomfortable possibility.
The young person who once started at the bottom and worked their way up may find there isn’t much of a bottom left.
And now we have a political argument about what to do about it.
ACT has proposed keeping the adult minimum wage at $23.95 an hour for three years and introducing a training wage for under-20s worth 60 per cent of that rate — about $14.37 an hour — for their first 12 months with an employer.
The argument for the proposal is straightforward.
If an inexperienced worker costs less to employ, perhaps more businesses will be prepared to take a chance on one.
That isn’t a ridiculous question.
A small business deciding whether it can afford another employee does not necessarily look at a young worker in the same way as a large corporation does.
Training takes time.
Mistakes cost money.
Someone has to teach the new employee how the place works.
And if the choice is between a young person being paid less while gaining genuine experience or not being hired at all, there is a reasonable argument that the first option deserves consideration.
But there is another question.
How low is too low?
The current starting-out and training minimum wage is $19.16 an hour.
ACT’s proposed $14.37 would be a significant reduction.
Critics argue that would mean young workers being paid substantially less for work that may be much the same as everyone else’s.
And that matters.
Because being young doesn’t make your rent cheaper.
It doesn’t make your groceries cheaper.
It doesn’t make petrol cheaper.
It doesn’t make a bus ticket cheaper.
The debate shouldn’t therefore be reduced to “young people need jobs” versus “young people need higher wages”.
Both things can be true.
Young people need a genuine way into employment.
And they need to be able to afford to live.
There is another approach on the table.
Labour has proposed expanding Apprenticeship Boost so employers would receive $500 a month for up to two years when they take on and train eligible apprentices, alongside wider eligibility, a $1000 tools and equipment grant and additional mentoring.
The current Government Apprenticeship Boost scheme already provides eligible employers with $500 a month for up to 12 months for first-year apprentices in targeted occupations.
That’s a very different approach.
Rather than making the worker cheaper, it puts some of the cost of training onto a government subsidy.
Which brings us back to the bigger question.
Who should pay for the first step into working life?
The young person?
The employer?
The taxpayer?
Or some combination of all three?
I’m not convinced there is a simple answer.
But I am convinced we shouldn’t quietly accept a situation where young people need experience to get a job, while employers increasingly need people who already know how to do the job.
That system doesn’t work.
The first job has always been a bit of a gamble.
The employer takes a chance on an inexperienced worker.
The worker takes a chance on an employer.
Sometimes it works beautifully.
Sometimes it doesn’t.
That’s how people learn.
And perhaps that’s what we’ve forgotten.
A first job isn’t supposed to be the finished product.
It’s supposed to be the start.
We need to make sure the first rung of the ladder is still there.
Because if we remove it, telling young people to “get a job” starts to sound a lot like telling someone to climb a ladder after we’ve taken away the bottom rung.
And that’s a problem that won’t be fixed by one political party, one wage policy or one government programme.
It will require someone to give young people a chance.
The challenge is how we make sure enough people are willing to do it.