THE first State of Shellharbour's Children Report 2014 has painted a concerning picture of the region's youth.

The report compared local, state and national data on early childhood development to help form the five-year strategic plan for the Communities for Children Shellharbour program through Barnardos Australia.

The report revealed that 62.9 per cent of residents left school before year 11, almost half (49.9 per cent) of residents over 15 years old had no qualifications and youth unemployment (15.8 per cent) was higher than the state average (12.8 per cent).

Barnardos Australia Communities for Children senior program officer Carol Lymbery said there were several contributing factors

"One aspect is about the aspiration parents and families have for their children," she said.

"We have a high number of young parents that don't finish school, and youth unemployment was high.

"If we can work with these children, the community and schools as early as possible to improve our literacy and numeracy competence, then hopefully these children will stay at school."

There were a high number of residents with a trade qualification, with 25 per cent in Shellharbour LGA compared to 17 per cent in NSW.

The report also showed that 11.16 per cent of children were from low-income families - earning under $600 a week - and results from schools with the highest number of Aboriginal and Torres Strait Islander students were "substantially below" the national average.

Ms Lymbery said the program would be working with the community and schools to improve opportunities for children who were finding school difficult. The report also indicated growing numbers of children by 2031 (0-14 years old - 21 per cent) and older people (over 55s - 28 per cent), would mean early childhood services would compete with aged care services.

"With an influx of over-55s in the city, council will be under pressure to provide more services in that area," Ms Lymbery said.

"We can't see on the horizon that government will fund the construction of early childhood services. They are relying on market forces constructing early childhood services.

"If not publicly funded in terms of construction, then often they are not constructed by the profit sector in disadvantaged communities."

The report also indicated only 31 per cent of early childhood services meet or exceed the National Quality Standard.

However, it wasn't all bad news: the report also showed Shellharbour children were securely housed, well-immunised, and had good visitation with child and family health services. Children also had high access to internet, and family violence and domestic violence were lower than the state average.

Barnardos Australia Communities for Children program manager Lisa O'Grady said identifying the areas of greatest need would mean funding would be injected as a priority.

"The premise of this report is to give children of Shellharbour the best start in life," she said.

"This is part of the planning process and through a consultation period via an advisory committee the community, and children will also have their say."

The program is funded by the federal government's Department of Social Services. The committee is expected to be formed before year's end.

Data was collected from census, local government, health, education, police, community groups and governmental and non-governmental organisations.