April figures from the ABS Labour Force Survey show the jobless rate for youth aged between 15 and 24 in the Hunter region was 17.6 per cent compared to the 12.6 per cent in NSW and 13.9 per cent nationally.

The youth unemployment rate in Newcastle and Lake Macquarie stood at 18.7 per cent, with the Hunter Valley rate at 15.7 per cent.

Hunter Research Foundation Centre lead economist Anthea Bill said the large jump in the Hunter's youth jobless rate between February and April came after the region's figures had trailed the NSW and national figures last year. "Between February and April, the youth unemployment rate rose 7 percentage points, compared to a 1 percentage point rise in NSW and 0.8 per cent in Australia," she said.

Dr Bill said 2016 Census figures showed that youth represented the greater share of those employed in the industries most impacted in the Hunter - food services or hospitality, accommodation and arts and recreation.

"This is likely a key reason we have seen the youth rate move up quicker than the state or the nation," she said, adding that the NSW Business Chamber Conditions survey showed tourism had already been knocked by drought and bushfires.

Dr Bill said the 17.6 per cent Hunter youth jobless figures was high compared to an average of 11.8 per cent over the last decade, and 11.9 per cent in the past five years. The April figures are not the worst figures for the decade - in late 2014 the youth rate rose to 20 per cent and stayed high in early 2015 as a result of a windback in mining investment and manufacturing job losses; and the closure of BHP in the late 1990s also resulted in high rates.

Dr Bill warned the key risk of the current figures was a "blighting" of young people's long-term work and earning opportunities, just as they were entering the workforce.

"Many are at a vulnerable point of transition between education and work, just as the coronavirus pandemic has impacted," she said.

"Young people are vulnerable in the labour market anyway because they have shorter work histories and less acquired skills/qualifications, they are also more likely to work in jobs which are casual and therefore more likely to be wound back or have hours cut when an economic downturn hits."

Dr Bill said while JobKeeper and the increase in JobSeeker have provided a safety net, it was unknown how young people would fare after September, after which time it is not known if the Government will continue the support, and it remains to be seen whether the hardest hit sectors will rebound.

"If those supports are removed or significantly tapered down when key sectors haven't recovered, poverty is a risk - especially for young people in low income families and/or young people who do not have immediate family, broader family or friend support," she said.

"Those youth will be particularly vulnerable to emotional, financial and housing stress from ongoing loss of work."

Dr Bill also said underutilisation - which combines unemployment and underemployment, when people are not working as many hours as desired - was a big concern. The nation's youth underutilisation rate is 37 per cent, while the base national rate is near 20 per cent.

"Research shows youth have had more crowding out from employment since the GFC due to slower pace economic growth and rising participation of older Australians," she said.

Hunter Business Chamber chief executive officer Bob Hawes said youth in regional areas were typically hardest hit due to a lack of diversity in job opportunities.

"Sectors that youth migrate to, hospitality and cultural facilities, have been the hardest hit, [whereas] in the capitals there is greater diversity, in fintech and things we just don't have," he says.

"Regional areas, and we noted across the regions in the Business NSW study, that some were even worse - are exposed to tourism and accommodation."

Mr Hawes said the youth jobless rate had dipped dramatically over the years but shown signs of improvement in recent years, due to economic factors and more take up of vocational opportunities. However "flat" conditions in 2019, particularly in retail, set the scene for 2020.

Businesses were confused by vocational funding changes, which he believed to be a factor in the jobless youth rate: "The only way we can improve the quality of outcomes is to reduce course fees, employ more trainers and tie the courses and funding to outcomes."

He said changes to the vocational system had led to a lack of business confidence about training costs, and a "reset" was needed, as hinted by Scott Morrison's JobMaker comments.

Mr Hawes said the coronavirus had shone a spotlight on Australia's manufacturing sovereignty but the focus must also be on maintaining a pipeline of skills: "You can't snap your fingers and say, 'Bring them on' - skills take years to accrue."

Mr Hawes said school career advice may lead youth to believe university was "the better ticket" when vocational skills must be promoted.

"Think about boilermakers, that's the base trade [but] there are plenty of highly technical industry roles that need people who make things. If we tell kids there is no regard for making things and the future is in digital we will miss the mark enormously," he said. "If we pinch the pipe too tightly we'll find the water will be trickling out, it won't flow."

He said it was vital that efforts to boost skills development matched the trajectory of the government's economic hopes.