Activating Jobseekers

How Australia Does It

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This report on the recent Australian experience with activation policies contains valuable lessons for other countries that need to improve the effectiveness of employment services and control benefit expenditure. It provides overview and assessment of labour market policies in Australia including the main institutions, benefit system, training programmes, employment incentives, and disability employment assistance.

Australia is unique among OECD countries in that its mainstream employment services are all delivered by over 100 for-profit and non-profit providers competing in a “quasi-market”, with their operations financed by service fees, employment outcome payments, and a special fund for measures that tackle jobseekers’ barriers to employment. In most other OECD countries, these services are delivered by the Public Employment Service. In the mid 2000s, several benefits previously paid without a job-search requirement were closed or reformed, bringing more people into the effective labour force.

Australia now has one of the highest employment rates in the OECD and this report concludes that its activation system deserves some of the credit for this relatively good performance. The Job Services Australia model, introduced in 2009, reinforced the focus on employment outcomes for highly-disadvantaged groups. This report assesses the latest model for activation and puts forward some recommendations to improve its effectiveness.


Australian active labour market programmes

Expenditure on active labour market programmes, except employment services, is relatively low in Australia. However the data are not closely comparable with those of other countries because training and work experience through the Employment Pathway Fund is classified as expenditure on employment services, and unemployment benefits paid to participants in longer-term training or work-experience programmes are not reported as expenditure on these programmes. Policy changes since 2008 include the restructuring of Work for the Dole, which has reduced participant numbers, and jobseeker training through the Productivity Places Program. For youths without Year 12 schooling or equivalent, the Compact with Young Australians prioritised education and training over other activity. In non-remote areas, Community Development Employment Projects have been phased out so that Indigenous workers now have regular jobseeker status. Disability Employment Services resemble regular employment services but with higher funding, which allows providers to deliver ongoing support in the workplace in relevant cases. External evaluations of labour market programmes are relatively infrequent, but official evaluations using administrative data have provided a range of qualitative and quantitative evidence, including non-experimental estimates of the impact on exits from benefits for many of the programmes.


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