Intergenerational Inequality at Labour-Market Entry: Pre-Adult Hardship, Family Buffers, and Early-Career Risk
Melbourne Institute Working Paper No. 10/26
Date: June 2026
Author(s):
Abstract
This paper examines how intergenerational inequality is expressed at labour-market entry by linking pre-adult economic hardship to early-career trajectories of labour-market risk and precarious employment. Using longitudinal data from the HILDA Survey, we model hardship dynamically over ages 4–24 and relate pre-adult trajectories to labour-market risk and precarious-employment pathways over ages 25–30. The results reveal substantial heterogeneity in both family disadvantage and early-adult labour-market experiences, showing that static measures of family background and adult outcomes miss important dimensions of inequality. Persistent hardship is strongly associated with persistently adverse early-career trajectories, while moving out of hardship, volatile hardship, and no hardship are linked to substantially lower probabilities of sustained disadvantage. Family resources partially moderate these associations, but the effects vary by resource type. Short-term insurance provides the clearest buffering role, reducing the likelihood of persistent and worsening disadvantage. Overall, the findings suggest that unequal family resources shape unequal capacity to absorb labour-market risk at the transition to adulthood, with family buffers operating primarily as private insurance against sustained disadvantage rather than as a mechanism supporting strategic tolerance of precarious work.