The employment services system Jobactive has cost more than $6 billion across four years. It's a lot of public money, and there's growing evidence that the system is hardly working well.
Jobactive replaced the old Job Services Australia model but the blueprint is the same.
Working-age unemployed people are referred to private and non-government providers who are funded by the taxpayer to help them become job-ready and look for work through training and face-to-face meetings with case managers.
There’s a lack of connection between the services trying to help people get jobs and the people who are hiring. The government’s recently commissioned review, I Want to Work: Employment Services 2020 Report, makes this clear. It says 18 per cent of employers were using the system in 2007, and by last year that dropped to 4 per cent. If they’re not connected to employers, how do employment services know what the local labour market needs?
Another problem is churn. Last month The Australian revealed that employment service providers were receiving multiple payments for placing the same person into different jobs.
Almost 100,000 people have had between three and six job placements in three years; a further 4765 had seven or more placements; and almost 400 people have started and left 10 or more jobs in that time. We’re paying multiple times for the same people to be placed into insecure work over and over again.
We need labour market programs that work for industry, business and the unemployed.
That means refocusing the employment services system back towards its fundamental purpose: getting people into work. Australia needs labour market programs, not privatised welfare compliance agencies.
Employment services providers should be spending their time joining the dots between people who are out of work, employers, industry leadership, entrepreneurial support for those who want to start a business, training and education institutions, and the support services needed to help people get back on their feet and ready to work.
If we pay the same amount for any job outcome, no matter how insecure, no matter how poor the conditions, that only promotes churn. If people are on a hamster wheel of short-term, insecure job placements, it’s clear those insecure jobs aren’t much of a stepping stone to better work.
The people delivering our labour market programs — those on the frontline — need to be freed up to build connections in the local community so they can become experts on the local labour market.
Instead of spending all their time reporting to Centrelink about whether everyone on their books has sent out 20 job applications that month, they could be spending time with the local chamber of commerce or the leaders of local industry. Or that time could have been spent working on some of the root causes for long-term unemployment among those in their caseload.
Homelessness makes it hard to get a job. So does the fact you’ve escaped a domestic violence relationship and you’re still not safe. Or you’re still trying to recover from an injury not quite bad enough to qualify you for the disability support pension. Or you have an anxiety disorder, or a drug addiction.
Dealing with these issues can make a person more employable. Providing a better service to employers and individuals doesn’t have to cost more. You can start by cutting the administrative workload imposed on providers and the people they’re seeking to help.
Services tell me they struggle to keep good staff. They hire people who want to help others get their life back together, and get a job, but they just end up being welfare compliance enforcers. No wonder job satisfaction is elusive.
The skills shortages that exist show that our communities need much better connections between people, local labour market needs, and education and training.
A better employment services framework would see: Less onerous compliance obligations imposed on providers and their unemployed clients; performance indicators related to building relationships within local labour markets, industries and communities; and funding arrangements that reward better employment outcomes.
A revamped version of mutual obligation would serve the purpose of making people employable and work-ready. In a better system, employment services providers would refocus on delivering labour market programs that help people get work, not punishing people for being unemployed.
People who are looking for work need to be treated with respect, to be supported to develop the skills and experience they need for jobs in their local area, and they need to be helped to find secure, decent work.
This opinion piece was first published in The Australian on 8 January, 2019.