Youth unemployment has climbed to a four-year high, with economists and business groups increasingly pointing to a sharp rise in minimum wages as a key factor behind reduced hiring of young workers.
Youth Joblessness on the Rise
Recent labour data shows unemployment among young people rising steadily, reversing gains made after the pandemic. Analysts say entry-level and part-time jobs have been hit hardest, affecting students and first-time job seekers.
Service sectors such as retail, hospitality, and food services have seen the most strain.
Minimum Wage Increases Under Scrutiny
Economists argue that rapid minimum wage hikes have raised labour costs for employers, prompting some businesses to cut hiring, reduce working hours, or delay expansion plans.
Small and medium-sized enterprises are said to be particularly vulnerable to higher wage bills.
Labour advocates dispute claims that wage increases are solely responsible, arguing that higher pay is essential to address rising living costs. They point to broader economic factors such as slowing growth, automation, and weak consumer demand.
Experts say the relationship between wages and employment is complex and varies by sector.
Businesses Adjust Hiring Strategies
Some companies have turned to automation or reduced youth recruitment, favouring experienced workers who can justify higher wages. Others are shifting to short-term contracts to manage costs.
Officials say they are monitoring employment trends closely and may consider targeted measures such as wage subsidies, training programmes, or tax relief to support youth employment.
