Employment Assistance

Peter Yeend
Social Policy Section

The changing number and characteristics of jobseekers

Australia’s overall unemployment rate fell to 4.4 per cent in April 2007—its lowest level since November 1974.[1] This factor, together with the Government’s Welfare to Work changes that commenced on 1 July 2006, is influencing the number and characteristics of unemployed jobseekers requiring employment assistance.

The numbers of unemployed jobseekers receiving government provided income support are the lowest now for many years. In March 2007, the number of unemployed jobseekers receiving Newstart Allowance (NSA) was 473 278 and the number receiving Youth Allowance (other) (YA) was 71 619.[2] This compares with the total number of NSA recipients (there was no YA at that time) of 790 542 in June 1996.[3]  However the numbers of long-term unemployed (those on payment for 12 months or more) have remained relatively static.[4] The number of long-term unemployed on NSA in March 2007 was 281 937 representing 59.6 per cent of the NSA total, compared with 282 652 in June 1996 representing 35 per cent of the total.

Therefore, while the number of unemployed jobseekers on government income support is now lower than in the past, the proportion on income support for more than 12 months, the long-term unemployed, is larger now than in the past. This is a likely effect of the current economic boom. While those unemployed jobseekers with readily marketable skills quickly find work, the harder to place jobseekers with significant and/or multiple employment barriers remain reliant on income support. In short, although there are record low levels of overall unemployment and lower numbers of unemployed jobseekers on government income support for many years, those remaining jobseekers on NSA or YA are in many cases those with significant employment barriers.

Furthermore, as a result of the Government’s Welfare to Work changes, the numbers of jobseekers required to look for, and accept work, with different characteristics from those of the past and who have differing needs is likely to increase.[5] For example, these include:

  • Jobseekers with a partial capacity for work, being those who would have previously qualified for the Disability Support Pension (DSP). These are the persons assessed as being able to work for more than 15 hours a week and therefore do not now qualify for DSP, but may not be capable of full-time work. These jobseekers would have only part-time employment participation requirements.
  • Jobseekers who are partnered parents who do not have a qualifying child under age six. These persons would have previously qualified for Parenting Payment – Partnered (PPP), but are now provided with NSA or YA and required to look for and accept part-time work (up to 15 hours a week).
  • Jobseekers who are single parents who do not have a qualifying child under age eight. They can no longer claim Parenting Payment – Single (PPS) from 1 July 2006. They are now provided with NSA or YA and required to look for and accept part-time work (up to 15 hours a week).

There are also more jobseekers soon to enter the pool. From 1 July 2007 a further 233 000 jobseekers on PPP or PPS will be required to look for at least 15 hours a week work.[6] These are the PPP or PPS recipients who claimed before 1 July 2006 and are allowed to stay on PPP or PPS until their youngest child turns age 16. They had a year before being required to seek part-time work (up to 15 hours a week). The year ends when their youngest child turns seven or 1 July 2007, whichever is the later.

Budget measures

In response to these trends the 2007–08 Budget has expanded assistance for jobseekers with special needs. There are several enhancements to assistance provided to the unemployed in their endeavours to obtain work. The measures in part recognise that there are increasing numbers of jobseekers on NSA and YA who have particular barriers to employment. These measures are:

  • Mobility allowance – expanding eligibility criteria. Mobility Allowance (MA) is paid to a person with a disability who is undertaking work, or vocational training, voluntary work, or independent living/life skills training, and is unable to use public transport without substantial assistance. MA is paid at the higher rate ($104 per fortnight) to PPP/PPS recipients and Supported Wage System workers who have a reduced productivity capacity related to a disability.[7]
  • Parenting payment – expanded access to supplementary concessions. PPP recipients with a partial capacity for work will also be provided with access to the Pensioner Concession Card (PCC) as are currently PPS recipients with a partial capacity for work. Additionally, PPP and PPS recipients with a partial capacity for work will be able to retain their PCC for 52 weeks after they have lost payment of PPP/PPS due to employment income.[8]
  • Additional places in vocational rehabilitation services and the disability employment network provided by an extra $39.8 million over four years.[9]
  • Changes to access and the use of training credits on the Work for the Dole Program (WftD). $13.1 million over four years to provide a $500 incentive payment for WftD participants and to provide equity of access to part-time training credits for part-time WftD participants.[10]

The 2007–08 Budget has also expanded access to the Personal Support Program (PSP) in further recognition that, although the numbers have declined, many of those jobseekers remaining on income support have very significant employment barriers.

An extra $15.8 million has been provided to fund an extra 2000 places in the PSP over the next four years.[11] The PSP aims to enable people with multiple non-vocational barriers to employment to achieve economic and/or social outcomes that are relevant and appropriate to them. Barriers may include homelessness, drug and alcohol issues, psychological disorders, and domestic violence.

The PSP seeks to bridge the gap between crisis assistance and employment related assistance. The PSP is delivered by a network of community based and private organisations that provide individualised support and assistance to participants for up to two years. The participant and their provider jointly develop an action plan to address the participant’s non-vocational barriers. Providers monitor participants’ progress regularly and formally complete a report after 8 and 16 months of assistance.

Comment

These initiatives primarily appear to target jobseekers who may not be capable of full-time employment, thus addressing issues for the new types of jobseekers on NSA arising out of the Welfare to Work changes that commenced from 1 July 2006.

However, most of the initiatives do not involve significant amounts of expenditure, with the exception of the PSP expansion of $15.8 million and the additional places in vocational rehabilitation services and the disability employment network costing $39.8 million. The changes essentially expand access to, or fund extra assistance in, existing programs. The bulk of the assistance to these jobseekers will be provided by the contracted job placement providers under Job Network (JN). However there are no changes in this budget to the overall fee structures paid to JN providers, nor are there any extra funds for the contracted job placement providers that will provide this assistance to these jobseekers with special needs.

Endnotes



 

[1].    J. Hockey (Minister for Employment and Workplace Relations), Unemployment rate at 4.4% - lowest since 1974, media release, 10 May 2007, http://mediacentre.dewr.gov.au/mediacentre/MinisterHockey/Releases/UnemploymentRateAt44LowestSince1974.htm, accessed on 17 May 2007.

[2].    Department of Employment and Workplace Relations, Labour Market and Related payments – a monthly profile, March 2007, p. 3, http://www.workplace.gov.au/NR/rdonlyres/B1F69BB1-277A-4993-B292, accessed on 17 May 2007.

[3].     Department of Social Security, DSS Customers – a statistical overview 1996, p. 35.

[4].     Department of Employment and Workplace Relations, op. cit.

[5].    A background on those now provided with NSA or YA and required to look for and accept work can be seen in Dale Daniels and Peter Yeend, ‘Employment and Workplace Relations Legislation Amendment (Welfare to Work and Other Measures) Bill 2005’, Bills Digest, no. 70, Parliamentary Library, Canberra, 2005–06, http://www.aph.gov.au/library/pubs/bd/2005-06/06bd070.htm, accessed on 17 May 2007.

[6].    J. Hockey (Minister for Employment and Workplace Relations), Speech to the Australian Mines and Metals Association, Perth, Australia, 27 March 2007.

[7].    Australia. ‘Budget Measures 2007–08’, Budget Paper No. 2, p. 137, http://www.aph.gov.au/budget/2007-08/bp2/html/index.htm, accessed on 17 May 2007.

[8].    ibid., p. 138.

[9].    ibid., p. 139.

[10].   ibid., pp. 141–142.

[11].   ibid., p. 138.

 

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