Ask a policy expert: why is job training so difficult to access and not fit-for-purpose?
Fair Go? spokeswoman: Susan Mathewson, 64, Melbourne, on the Disability Support Pension, no super.
Wants to know: Why job training is so difficult to access and not fit-for-purpose, and how Centrelink is trying to help vulnerable people – like ageing women with no super – to reenter the workforce.
Sydney Policy Lab says: People like Susan are caught in a kind of pincer, at the mercy of a variety of systems that are not tailored to their situation. The inadequacies of superannuation, privatised Disability Employment Services, a fragmented vocational education system, and a generally weak labour market all combine to leave people like Susan struggling to escape poverty.
Is superannuation a safety net for retirement?
Superannuation is supposed to enable people to retire after a lifetime of work. But it is inadequate for people who spend time out of the workforce or are underemployed, women in particular.
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On the surface, Australia’s unemployment rate has been a relatively stable 5-6% for the past decade. However, 8.2% of people are underemployed, 13.2% are under-utilised and the current labour force participation rate is 65.7%. In reality, for the last five years, there have only been enough quality jobs to keep half of the population employed full time. This is part of a general trend of wage stagnation, rising inequality and rising costs of living leading to increased housing stress.
These pressures have not been evenly distributed. In 2017 the gender pay gap for full-time employees was 21.3%: men received on average $25,717 more annually than women for the same work. 68.5% of part-time workers are women, contributing to the average woman’s superannuation balance being 42% lower than the average man’s. 26% of women aged between 55 and 64 years had no coverage at all compared with 16% of men in that age bracket. While women and men experienced similar levels of unemployment in 2018, women experience much higher levels of underemployment.
It’s even harder for older women. Of the 3.5 million Australians aged 65 and over, the labour force participation rate has increased 62.5% since 2006, yet for women the increase has been 150%. Between 1997 and 2017 the partial age pension rate decreased from 75% to 66%, making superannuation even more important as a wage supplement. In 2017, the proportion of women 70 and over who never had superannuation coverage was 75%.
What training and education is available for jobseekers with a disability?
In 2008, assessment of whether a person with disability received income support payments shifted from a diagnosis of disability to a judgment of their capacity to work. From 2014, disability support pension recipients assessed as capable of working eight hours or more a week have been required to participate in mandatory activities such as work for the dole or Disability Employment Services. Unless they have an exemption available in certain special cases, people must meet various “mutual obligations” in order to receive income support.
Disability Employment Services (DES) and work for the dole providers are funded by the federal government to offer job training and work-ready support. The opening of the vocational education and training (VET) and employment services sector to for-profit and other non-government providers in the 1990s was intended to increase consumer choice and control over their experience, though it has failed to deliver better outcomes. In this Jobactive system, participants can choose almost any provider and can change their provider up to five times if they are unhappy with the services they are receiving. After that, they can only change after an assessment.
Does this Jobactive model work?
A central criticism of the Jobactive model is that it does not get people employed in the type of work that will keep them permanently off income support payments. The goals of providers and jobseekers are not necessarily aligned. In order to continue receiving income support, many people end up taking courses that are irrelevant either for the jobs they are applying for, or for the jobs available where they live. One woman reported being unemployed for nearly 10 years despite completing at least four Tafe certificates at the behest of the private service providers so she could keep getting welfare payments. Similar to Susan’s experience, one man reports a training course where he was given Microsoft Word access and told to “go for it.”
Employers have complained that people in the Jobactive program aren’t being given the right training, skills and qualifications to match the needs of actual jobs. A report by the Department of Jobs and Small Business showed that the number of employers involved with Jobactive decreased from 18% in 2007 to 4% last year.
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To get to one of the around 1,800 job centres across Australia, trainees have to commute long distances. Only 20% of participants find long-term work and one in five have been in the system for more than five years. As long employment gaps are often viewed with suspicion, the longer someone is out of the workforce, the more difficult it is to demonstrate hireability to employers. All of this results in welfare recipients being “parked”. This term is used to describe the experience of being stuck within the Jobactive cycle, where irrelevant training courses are offered with the promise of integrating people into the workforce while really keeping them parked receiving income support payments. This in turn contributes to the number of people underemployed or in low-skilled low-paid work.
If the system doesn’t work for jobseekers, who does it work for?
Welfare-to-work is a multibillion-dollar industry. Providers are given incentives based on low margins and high turnover. This has resulted in reports of fake numbers being given by providers. Moreover, these providers are not subject to freedom of information requests, so they are protected from public scrutiny. Peter Strong, the chief executive of the Council of Small Business of Australia, calls Jobactive a “failed service” and an “absolute waste of time.”
On top of the difficulties getting employment, people like Susan often report a social stigma attached to being a welfare recipient. There is a widespread sentiment that welfare is a burdensome governmental cost to be reduced aggressively and that those receiving income support payments can’t be trusted. As researcher Jenna Price notes, “[We] need policy, strategy and actions to overturn years of persecution of the poor.”
With 69.2% of older single women who experience housing stress remaining in it permanently, the ability of the welfare system as presently constructed to facilitate the upward mobility of people in Susan’s position looks dubious.
Reporting in this series is supported by VivCourt through the Guardian Civic Journalism Trust