Coronavirus Australia: A 10-year crisis is coming after COVID in the form of a mental health disaster

We’re all eager to put coronavirus behind us, but when that happens Australia will face another disaster for at least a decade.

An entire generation of Australians risks losing at least a decade of their lives as part of a painful, prolonged and costly disaster set to follow the coronavirus pandemic.

The cost of the country’s response to the COVID-19 pandemic will be felt for years to come and it’s young people who will carry most of the burden it causes, experts warn.

On top of that, the effects of high unemployment and diminished or entirely lost opportunity will disadvantage that cohort, with some left behind entirely.

Professor Peter Kelly heads the UNEVOC centre at RMIT, a UNESCO-backed hub for vocational education and skills research, and said the dire warnings are backed by evidence.

“We did some work after the Global Financial Crisis (GFC), which is the most recent example of the consequences faced after a significant economic issue,” Professor Kelly said.

“There were a lot of policy responses to the GFC that were inevitably followed by austerity measures – cuts in government spending and increased charges. Young people were disproportionately affected by the cost of the response and the consequences of it, the cuts and increased costs.

“They carried a really heavy burden for a decade after the GFC, and really it was just settling down when COVID-19 struck.”

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Professor Kelly and his team contributed to global research looking at how young people’s health and wellbeing, education and employment fared after the GFC.

The results were startling.

The immediate loss of opportunity was a setback, followed up with longer-term impacts on employment – dozens of applicants per vacant job, for example – and coupled with flat wage growth and a crumbling standard of living.

At the same time, austerity measures to pay for the GFC stimulus overwhelmingly hit younger Australians in areas like welfare and higher education.

In fact, the Government’s own Productivity Commission released a report in early August showing that in the decade from 2008-09 to 2018-19, people up to the age of 30 were much worse off than the same group in the previous 10 years.

“We’re concerned because the COVID-19 pandemic is much larger in terms of impact than the GFC,” Professor Kelly said.

“The long-term consequences of coronavirus on young Australians will almost certainly be considerably worse.”

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Australia’s response to the pandemic hasn’t come cheap – several hundred billion dollars and counting. Who will pay for all of that?

“We already have a good indication of it thanks to the changes to higher education and the more than doubling of fees for some degrees,” Professor Kelly said.

“COVID right now is a health crisis and young people aren’t as impacted right now as older people. But in what follows – a social, economic and cultural crisis – young people will be heavily impacted.”

In the wake of the GFC, general unemployment began to track downward while youth unemployment and underemployment remained stubbornly high.

Social services groups say that if a young person doesn’t enter meaningful employment within two years of completing studies, they’re more likely to be dependent on welfare through life.

Treasury forecasts are for continuing flat wage growth for the next decade for younger workers, and graduates can expect to earn “roughly eight per cent less in their first year of work and 3.5 per cent less after five years”.

The latest official data shows youth unemployment has jumped to 16 per cent – up almost five per cent in just three months.

A huge proportion of jobs lost during the coronavirus crisis were occupied by young people in hard-hit industries like hospitality and retail.

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It’s not just the loss of economic potential and employment opportunities that young people will grapple with.

The mental illness burden will be significant, warned Professor Patrick McGorry, one of Australia’s most respected voices on youth mental health.

If the economic collapse caused by COVID-19 is severe and the mental health system isn’t in a position to adequately respond, Professor McGorry said countless Australians will suffer.

“You’re going to see a whole generation of young people who will lose a decade of their lives and never get it back,” he said.

The economic shock of coronavirus will have flow-on effects for years to come, including negatively impacting mental health. Picture: AFP

Australia’s mental healthcare system was already struggling pre-pandemic and extreme pressure has been placed on it in the past several months.

“The system that will take on this huge increase in need was already judged to be broken and not fit for purpose prior to the pandemic,” Professor McGorry said.

“The mental health system has to be the top priority now. The stakes are extraordinarily high.

“We’ve turned the country upside down to save people from COVID-19. We’ve got to do something big to deal with the second huge health effect of the pandemic, which is mental health.

“We’ve been successful in saving thousands of lives from coronavirus. If we don’t get this right, we will lose lives from the mental health consequences of the pandemic and our response to it.”