Mainstream income support and re-employment services for Australian displaced workers

Many displaced workers in Australia who do not quickly find jobs are likely to be ineligible for income assistance for an extended period of time following their redundancy. This is consistent with the Australian social assistance approach which restricts income support to persons most in need. Since access to more intensive re-employment services is conditional on the receipt of income support, this also implies that a majority of displaced workers do not qualify for these services. Even those who qualify mostly receive only basic support during the first year of unemployment. By this time, a number of displaced workers who did not find a new job may have become demotivated or even have exited the labour force, making a return to work more difficult. This approach minimises the inefficient use of resources on displaced workers who do not need help, but can be problematic for those who face more difficulties in finding a new job, notably older displaced workers. Moreover, the incentive structure for employment service providers is tilted more to getting the unemployed quickly back into work than investing in training, which may further reduce the likelihood of low-qualified or long-tenured displaced workers switching to new jobs in sectors and occupations in demand.