Problems with pushing new coercive employment policies

Beware the welfare policy areas when we get bi-partisanship. Abbott, Gillard and Swan are all singing from the same songbook, that more people needed in the workforce. Coerce those on welfare, persecute those with disabilities, induce older workers, do whatever it takes to get more than a million extra people into the job market to fill the demands of the labour market.

Leaving aside the Malthusian assumptions about the “idle” poor, the whole push is based on some unsupported assumptions about the demand for labour. There is no evidence that the plethora of jobs to be filled exist. The best estimate would be that at any time there are about 250,000 jobs to be filled. Even if one cut the various short-term visa workers, this may add another 100,000. And that calculation does not look at the types of jobs, which are nearly all skilled and/or demand experience.

Therefore trying to retain skilled older workers makes sense, as does extending the hours of the 800,000 plus under-used workers who want to add hours to their current part-time status. They have current employment, skills and presumably evidence of being able to do the jobs.

However, integrating the 600,000 ABS defined as looking for work or even the 340,000-plus on Newstart, 180,000-plus who have been on the payment for more than 12 months is not easy. There are not enough jobs for even those who are defined as job ready, and they also face discrimination by employers who want recent work evidence and often specific skills and experience. Pushing those with disabilities and older workers who we know face discrimination is sheer malice as they will just face more rejections.

The non-employed do need jobs and work experience, and better support services. We need government to set up proper work experience and job creation options, not work for the dole, which is seen as punishment, not as training and doesn’t work. There needs to be work on employers so they do not discriminate — and offer a fair go to those with less experience or other less boss-attractive characteristics.

There is ample evidence that these types of control programs that cut income and coerce behaviours do not work because they increase the feelings of inadequacy and lack of autonomy and self-respect. The evidence is that this approach is more likely to exacerbate passivity and withdrawal, rather than incentives for compliance. The Abbott proposals and the approach by Gillard suggest that their policies will damage the recipients. The NT experience shows it doesn’t work, as employment is not up and anti-social behaviour has increased.

This is unfortunately another example of populist scapegoating, not evidence-based policy.  The data below that this approach should be based on clearly shows the supply of labour so far exceeds demand, that we need to do something about demand and who is ecxcluded from the limited jobs available.


The ANZ Job Advertisements Series, which shows the total number of jobs advertised in major metropolitan newspapers and on the internet in February, averaged 193,555 advertisements per week (seasonally adjusted).

The ABS February 2011 Job Vacancies Australia seasonally adjusted total was  190,000. These figures are fairly close, so suggest that these are the publicly accessible numbers of available jobs at any one time. Even if you assume that there may be many others not advertised, say 50,000 possible jobs, the total of about 250,000 vacancies Australia-wide is a reasonable estimate. These advertisements/vacancies range obviously across the spectrum and mostly require recent skills, qualification and experiences.

There were about 340,795 people receiving Newstart in February who are expected to be actively seeking work, 186,195 of these have been on payments for more than 12 months.  These, however, are only those receiving benefits. The ABS survey for the same month show those actively looking for work in the previous month, which totalled 604,000.  Add to these some 860,000 part-timers who want more hours than they have, and the group known as “discouraged workers” another 100,000 plus and the numbers of those wanting work rise.

For discouraged job seekers, the most commonly reported main reason for not actively looking for work was “Considered too old by employers” (38%). This was followed by “Lacked necessary training, skills or experience” (18%),  The largest percentage point difference between men and women who were discouraged job seekers was for “Considered too old by employers” (50% and 39% respectively).