Analysis by consultancy firm EY shows the average 21-year-old Australian entering the workforce in 2020 will miss out on $32,000 in lost wages over the next decade compared those who entered the workforce during a non-recessionary period.

This could result in $22,000 less to spend on a home and $30,000 less in superannuation.

The analysis also suggests this could result in as much as $7 billion in lost wages over the next 10 years for young workers thanks to Australia's first recession in 29 years.

Need somewhere to store cash and earn interest? The table below features non-introductory savings accounts with some of the highest interest rates on the market.

Provider

4000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
  • Bonus rate for the first 4 months from account opening
  • No account keeping fees
  • No minimum balance

High Interest Savings Account (< $250k)

  • Bonus rate for the first 4 months from account opening
  • No account keeping fees
  • No minimum balance
02000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
No monthly fees
  • Download the App to open your account
  • Get better visibility of your spending within App!
  • Deposit $200 per month to activate bonus interest
No monthly fees

Save Account

  • Download the App to open your account
  • Get better visibility of your spending within App!
  • Deposit $200 per month to activate bonus interest
020000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

HomeME Savings Account ($0 - $100,000)

    02001$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

    Growth Saver ($1 - $25k)

      010000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
      For customers aged 14-35 years
      For customers aged 14-35 years

      Future Saver Account ( < $50k)

        05001$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
        • Maximum Age - 24

        Goal Saver

        • Maximum Age - 24
        010000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

        Boost Saver

          00.011$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

          Reward Saver Account (31 years +) ($0-$100k)

            01000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

            Bonus Saver Account (Amounts < $100k)

              0201$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

              Reward Saver Kick Start (Amounts ≤ $1m)

                00.010$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                Life (< 30 years) (Monthly deposit)

                  5000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                  NetBank Saver

                    000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                    ANZ Save

                      010000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                      Savings Maximiser (<$100k)

                        050$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                        Young Saver Account

                          0501$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                          Save up

                            010000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details
                            • Earn up to 5.40% pa by depositing $1,000 in the previous month
                            • No account fees
                            • Easy access to your money

                            Saver Account (<$250k)

                            • Earn up to 5.40% pa by depositing $1,000 in the previous month
                            • No account fees
                            • Easy access to your money
                            02000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                            Bonus Saver (<$1 Million)

                              000$product[$field["value"]]$product[$field["value"]]$product[$field["value"]]More details

                              Smart Saver Account (Under 25)

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                                All products with a link to a product provider’s website have a commercial marketing relationship between us and these providers. These products may appear prominently and first within the search tables regardless of their attributes and may include products marked as promoted, featured or sponsored. The link to a product provider’s website will allow you to get more information or apply for the product. By de-selecting “Show online partners only” additional non-commercialised products may be displayed and re-sorted at the top of the table. For more information on how we’ve selected these “Sponsored”, “Featured” and “Promoted” products, the products we compare, how we make money, and other important information about our service, please click here. Rates correct as of May 24, 2024. View disclaimer.

                                The research, based on Census data from the Australian Bureau of Statistics (ABS) and information from the U.S. National Bureau of Economic Research (NBER), shows that up to 90% of a person's income growth occurs in the first 10 years of their working life.

                                This means that not only will the recession have an immediate impact on income, but it could have a long-lasting negative impact on wages for workers aged 18-23.

                                EY chief economist Jo Masters said while young Australian workers will cop the brunt of the impact, they can either choose to be a 'passenger' or a 'driver' in the face of fewer job opportunities and a subdued economy.

                                "How well young people make it through this critical period will depend on whether they choose to be a passenger, or a driver of their economic future. 

                                "The Passengers risk consigning themselves to the wages slow lane while the Drivers give themselves a fighting chance to attain goals for their career, home ownership and retirement.

                                “For young Australians who are facing lower job opportunities in subdued economic conditions, upskilling via short courses, improving financial literacy and exploring jobs that present the opportunity to improve jobs skill match or boost income, and ensuring a proactive savings plan, are steps that will help them to overcome the economic challenges,” said Ms Masters.

                                The analysis found that contributing an extra $300 a year to superannuation and saving at least 25% of their income would make up for lost income.

                                "However, whether this group is ready to curb discretionary spending is yet to be seen," Ms Masters said.

                                The latest EY Future Consumer Index survey suggests that one in five people aged 18 to 25 still plan to increase discretionary spending in the next six months. 

                                Calls for more stimulus

                                Ms Masters said the findings of the research is also critical for the government.

                                “The government is already pivoting from immediate support during the lockdown phase towards policies to underpin sustainable economic growth and job opportunity," Ms Masters said.

                                "While there is a role to support those facing into an economy in transition, proactive policy will also be needed to encourage job creation, assist with skill matching and supporting proactivity through financial literacy."

                                The Grattan Institute outlined a six-month period of policy reform aimed at dragging the unemployment figure to 5% by mid-2022.

                                It said the Federal Government should inject $70 billion to $90 billion in extra economic stimulus, including revamping and extending JobKeeper.

                                It also said JobKeeper should be expanded to include university staff, casual workers, and temporary migrants, and be extended beyond September for businesses that are still struggling. 

                                They also called for the permanent rate of JobSeeker to be increased by at least $100 a week.

                                On Friday, Reserve Bank Governor Philip Lowe called on the banks to continue lending as he expressed fears of a second spike in unemployment when stimulus measures wind down in September.