Youth employment: The good, the bad and the ugly

The Budget measures aiming at solving youth unemployment are an improvement on previous programmes, but fall short of targeting the real causes of a jobless youth. As my research shows, instead of headline spending figures, we need a growth agenda to fight youth unemployment, which means meaningful economic reforms — including a smart workplace regulation.

The Good

On the bright side, the 2016 Budget ‘Youth Employment Package‘ deepens the federal government’s commitment to the investment approach to welfare. Through this new approach, actuarial valuation is used to determine the most effective forms of support to empower welfare recipients for a successful transition from welfare dependence to the workforce.

It is positive to see the new Youth Jobs PaTH (YJP) programme to provide young jobseekers a leg up in entering the labour market. Despite being branded by the federal government as an ‘innovative Prepare-Trial-Hire’ method, the YJP is in most instances an improved version of the National Work Experience Programme introduced during the Abbott leadership a year before.

Nonetheless, it should be stressed that the new YJP programme provides a much-needed boost to the initial employability skills training phase, and offers higher incentives for both workers and employers to get the most out of the work trial period.

The Bad

On a more cynical note, and if history is any guide, there is nothing in this budget that has not at some extent been tested before — with paltry results. In particular, despite all the trumpetings, these budget measures still carry the same underlying misguided belief that the solution to a jobless youth rests on more government spending and micromanagement.

The Ugly

The biggest disappointment comes from the lack of commitment towards real economic reforms. In particular, there is no mention of addressing Australia’s complex workplace regulations structure, including prohibitive penalty rates that ultimately penalise the most vulnerable jobseekers. Instead of wage subsidies and other welfare handouts, Australia needs a more flexible workplace so Australians of all ages and expertise get the much-vaunted fair go.

More free markets, less interventionism: that’s what a truly liberal budget should be about.