ESSA

ESSA

Election 2016: Youth unemployment


Sam O'Connor

By

July 1st, 2016


Sam O’Connor compares the two major parties’ policies on their proposals to help young jobseekers find employment.


“Jobs and growth” has been the mantra of the Government’s re-election campaign, and as always, the economy has been the most important topic of debate in Election 2016. Australia is currently grappling with a serious youth unemployment problem, especially in rural and regional areas. Unemployment among 15-24 year olds is approaching 30% in Outback Queensland, and sits at around 15-20% in other economically deprived parts of the country.

Both major political parties have offered up policy proposals to help tackle unemployment, especially amongst young people. Below is a summary of these, organised by party:

Liberal/National Coalition

In the 2016 Budget, the Government announced a $840 million Youth Unemployment Package. By far the most important component of this package (and the most contentious) is the $751.7 million Prepare-Trial-Hire (PaTH) program, which aims to provide 120,000 “internships” to young jobseekers over a period of four years. The PaTH proposal is a three-stage process:

1. Six weeks of employability skills and job preparations programs.
2. An internship placement of between four to twelve weeks, paid $200 a fortnight.
3. Suitable interns are provided with ongoing employment from employers after the completion of their internship.

In order to encourage businesses to take on these interns, the government will provide upfront payments of $1000 for each intern a business employs, and will pay wage subsidies of up to $10,000 for those interns who go on to regular employment. With an internship expected to encompass up to 25 hours of work every week, interns participating in the PaTH program could be paid as little as $4 an hour- below the Australian minimum wage or relative poverty line, even when Newstart is factored in.

The response to PaTH from stakeholders has been mixed. While trade unions have slammed the proposal as unfair and possibly illegal, the Australian Council of Social Service has welcomed PaTH as an alternative to the existing work-for-the-dole policy, of which ACOSS has been a long-standing critic. However, ACOSS has also expressed concerns that there is a risk that interns could be exploited as a cheap source of temporary labour by employers.

Labor

Labor’s counterpart to PaTH, Working Futures, shares some similarities with the Government’s policy. It is a three-step plan that involves job training and work placements, described below. However, there are some crucial differences, which have been italicised.

1. A “six-week work readiness course” aimed at teaching employment skills to young jobseekers.
2. A six-month work placement, paid at an “award-equivalent training wage”.
3. A fully-funded Certificate III in a subject chosen by the jobseeker.

As one can deduce, the ALP’s proposal differs from the government’s in that its work placements would be for a longer period of time, paid a rate consistent with trainees in other fields, rather than PaTH’s $200 a fortnight, and have the opportunity to complete a TAFE Certificate III. Labor argues this is a fairer policy than the Government’s PaTH. Labor’s plan has also been praised for specifically targeting the ‘skills gap’ by including an opportunity for jobseekers to upskill themselves through completing further education.
However, there is a conspicuous lack of any publicly available costings for this policy- with the caveat that Labor claims to have had this policy costed by the Parliamentary Budget Office, and that its cost is fully offset by reductions in other programs.

Both plans ostensibly have the same goal in mind- reducing youth unemployment- and incorporate largely similar ways of achieving this. Rather than a hand-out, both plans are intended as a hand-up by allowing jobseekers to gain the experience so desired by employers. This largely follows a trend of similar programs throughout the Western world. Tackling the issue of youth unemployment is utterly crucial for ensuring that struggling young Australians are not left behind by an economy entering transition. Whichever of the Coalition or Labor forms the next Government will have to ensure their plan is promptly put into action.

The views expressed within this article are those of the author and do not represent the views of the ESSA Committee or the Society's sponsors. Use of any content from this article should clearly attribute the work to the author and not to ESSA or its sponsors.

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