Australia lagging on helping unemployed back to work

AUSTRALIA spends less than almost any other rich country to help its unemployed people get back to work, OECD figures reveal.

The OECD's yearly employment report shows the government's spending on programs to help the unemployed into jobs in 2008-09 was equal fourth-lowest of the 26 rich countries surveyed. The report shows that, in this area, the change of government has meant no change in policy despite Labor's rhetoric on the importance of giving young Australians the skills employers need.

In 2006-07 and 2007-08, despite intense skills shortages, the Howard government spent just 0.14 per cent of Australia's gross domestic product on training, wage subsidies and other support to make the unemployed employable. In 2008-09, despite rapidly rising unemployment, the Labor government spent exactly the same. Of the 26 rich countries surveyed, only the Czech Republic, Japan and Slovenia spent less.

The figures came as a survey of employers found one in three says their business is already suffering from shortages of skilled workers, and almost half predict that by 2015 skills shortages will limit their activity.

Bureau of Statistics figures show that even among men of prime working age 25 to 54-year-olds almost 10 per cent have now dropped out of the workforce, one of the largest dropout rates in the Western world.

The OECD report shows while Australia's spending on the Job Network was roughly the same as other countries spent on their job agencies, other OECD countries on average spent three times as much as Australia did on support programs.

Other OECD countries on average spent 0.14 per cent of their GDP on training alone. Australia spent just 0.01 per cent, and that has not changed since Labor took office.

Denmark, widely admired for its "flexicurity" programs a tough-love agenda which means people losing jobs get retraining instead of redundancy payouts spent 0.98 per cent of its GDP in wage subsidies, retraining and incentives for employers to take on the jobless. That was seven times Australia's spending level.

Labor has significantly increased the number of places available for skills training, although the true number has been disguised by taking money from old programs for new ones. But little of this has been targeted on the unemployed.