Australia’s official unemployment rate hit 7.1 % ^[1] in May, our highest since 2001. It’s almost inevitable that as the federal government eases its Covid-19-related stimulus measures, like the JobKeeper payment ^[2], the figure will rise further.

Understandably, getting the economy back on track is a crucial priority for all Australian governments, from local councils to the Commonwealth. However, historically high rates of unemployment, coupled with a trend of chronic underemployment and declining trust in government, will have second-order and third-order impacts that will also need policy responses.

One area of serious concern for the federal government should be the increased vulnerability of some Australians to radicalisation by extremist groups.

In February, ASIO Director-General Mike Burgess argued ^[3] that ‘the security threats confronting Australia remain formidable and are continually evolving’. There can be no doubt that this statement accurately reflects the terrorist threat as Australia slowly emerges from what might be only the first wave of the pandemic.

Despite Covid-19 and the health-security measures it’s brought about, Australian authorities have continued to enjoy success in collecting counterterrorism intelligence and disrupting terror plots ^[4]. And they should be commended for achieving those results in such challenging times.

Investment by federal, state and territory governments in the detection, investigation and disruption of terror plots remains critical to Australians’ security. However, as the former head of ASPI’s counterterrorism program Isaac Kfir and I noted in this year’s counterterrorism yearbook ^[3], ‘despite terrorism developments, attacks are in decline, which has led some states to reduce their threat levels … due in no small part to positive developments in countering violent extremism’.

Even before Covid-19, it appeared that Australia had entered a new phase in its counterterrorism campaign which has seen a reduction in the overall number of terror plots and attacks. There were already signs that with this success governments needed to change the focus of their counterterrorism strategy. That meant putting an increased emphasis on developing further measures to prevent radicalisation rather than focusing mainly on disrupting terrorist plots. However, the pandemic occurred before this new thinking had the opportunity to take hold.

While Covid-19 has drastically reduced terrorist groups’ freedom of movement, its effects have also created increased strategic vulnerabilities, especially to radicalisation. The economic and social impacts of the crisis, such as higher unemployment and lower social mobility, are producing the sudden and unexpected changes that make an increasing number of Australians vulnerable to radicalisation.

In making this assessment, I recognise that the empirical evidence suggests that the journey to radicalisation is highly personalised. However, there’s also evidence that there are push and pull factors that influence this personal journey.

It’s true that there’s insufficient empirical work to prove a causal link between unemployment and radicalisation. However, the Brookings Institution has found ^[5] that ‘while it seems to be true that unemployment on its own does not impact radicalization, unemployment among the educated leads to a greater probability of radicalization’.

Unfortunately, Covid-19-generated unemployment has disproportionately affected young and often already underemployed Australians. The pandemic will also have a lasting impact on young Australians’ economic confidence. In After Covid-19: Australia and the world rebuild ^[6], my ASPI colleagues argue that these impacts ‘have exacerbated pre-existing and underlying economic insecurities and intergenerational wealth disparities that concern many young people’. Declining levels of trust in government will aggravate the situation.

There is clear evidence to suggest ^[5] that ‘individuals whose expectations for economic improvement and social mobility are frustrated are at a greater risk of radicalization’. Increased levels of radicalisation during and after recessions in Western liberal democracies are not unprecedented. The United Kingdom’s 1980s recession saw an increase in radicalisation ^[7], for example.

Without a targeted policy response from the federal government, many young Australians will be increasingly vulnerable to embarking on, or continuing along, a path to radicalisation.

It’s unlikely that right-wing extremists or Salafi jihadists are blind to the opportunity to target the rising number of politically and economically frustrated young Australians.

Australia’s counterterrorism strategy needs to be adapted and enhanced to deal with the next phase of the terrorism challenge. The appropriate response, though, won’t be another tranche of legislation, additional investigative powers or increased intelligence and surveillance capabilities.

Of course, programs focused on countering violent extremism will play a critical role in this next phase, even though they experience mixed rates of success. Similarly, deradicalisation will play an essential part in mitigating the security threat, even though these approaches have had poor rates of success.

What the federal government should do is increase its programmatic efforts to prevent radicalisation in the first place. While counternarratives will remain critical, our response will need to be far more multifaceted than that.

The government should focus on giving young Australians a political voice to express their frustrations with the economic situation they face. In developing this response, young Australians’ understanding of how to engage with governments will need to be enhanced. And the government will need to prove to young Australians that it’s willing to listen to them.

The government should also provide the necessary economic measures to increase young Australians’ meaningful employment. And it will need to address the fatalist economic attitudes held by many young Australians.

The states, territories and the Commonwealth will need to implement a comprehensive program to counter the messages sent out online by a variety of terrorist groups and other proponents of politically motivated violence.

While the number of terror attacks and plots in Australia is in decline, and our counterterrorism efforts have so far been incredibly successful, the government cannot afford to wait until the next generation of radicalised Australians materialises. And it would be ill-advised to try to address the challenge with a security approach, because it may not get the support of security-weary and economically frustrated Australians.