By Nick Everett
After the launch of the federal government's Job Network on May 1, employment minister David Kemp hailed it as one of the great social reforms of the last 50 years. It would provide the best employment matching system in the world, he declared.
With the youth unemployment rate at 29.9% — the worst in nearly two years — it is apparent Job Network provides more pain than gain for Australia's unemployed.
Job Network came at enormous expense — 5000 jobs were lost in the Commonwealth Employment Service as 311 new Job Network providers opened their doors. While more than $180 million has been budgeted for job matching contracts, only a handful of large companies are positioned to benefit.
When the federal government tendered for Job Network contracts, most of the lucrative "Flex Three" work — the contracts for assisting long-term unemployed — went to just four outfits across Australia.
The big winners included Drake International, Mission Australia and the Hospitality Training Company. Drake International and Manpower have developed a reputation for providing contract labour to companies to replace unionised workers, a practice encouraged by the federal government's Workplace Relations Act introduced in January last year.
A major player in the more lucrative contracts is the government-owned Employment National. While employing only some 10% of the 5500 former CES employees (most initially hired on individual contracts), Employment National boasts some 200 offices Australia-wide, committed to returning profits to the federal government.
Employment National's managing director Peter Storey knows how to make a tidy profit. His previous job was as a manager with the owners of Patrick Stevedoring, the company responsible for sacking 1400 wharfies in the recent waterfront dispute.
Employment National, which has gained a substantial foothold within the network thanks to an enormous government-funded advertising blitz, has the potential to be a major recruiter of scab labour to assist other government-sponsored confrontations with organised workers.
Community-based job agencies, however, have been the big losers in the system. Beacon Foundation and Glenorchy Skillshare are two of hundreds of established small community-based organisations denied more lucrative grants to service the long-term unemployed. Consequently, these and many other organisations are struggling to survive in the privatised job market, despite operating in an area of high unemployment.
Patrick Shaw, a former union delegate at Glenorchy CES in Hobart, is unemployed. Because his wife works and he is not on unemployment benefits, Shaw does not qualify for Job Network assistance.
"We had a CES with 48 staff here in Glenorchy and a branch at Bridgewater, which is an area of high unemployment", Shaw explained to the ABC TV's Lateline. "We now have Employment National with two staff, Centrepact with an office here as well as in Moonah, and Skillshare, which is six kilometres away."
Those hardest hit by Job Network are young people. With 46,000 people under 21 being cut off unemployment benefits with the introduction of the common youth allowance on July 1, these unemployed are disqualified from Job Network assistance.
The introduction of the work for the dole scheme is also placing increasing pressure on young people on benefits to accept poorly paid and casual work.
Kemp has warned that up to 36,000 young unemployed people will be required to undertake training in literacy and numeracy or risk losing their payments.
"All people aged between 18 and 24 who have been receiving unemployment benefits for six months or more must now do more to help themselves find work or risk having their payments reduced or possibly withdrawn", Kemp said.
"The government's program of 'mutual obligation' for the unemployed amounts to an ideological attack on the right of unemployed people to social security", Wendy Robertson, national coordinator of the socialist youth organisation Resistance, told 91×ÔÅÄÂÛ̳ Weekly.
"Furthermore, it is young people in particular who bear the brunt of the government's labour market changes because they are most easily cajoled into accepting underpaid or exploitative work when threatened with the loss of social security payments", she said.
After the release of last month's youth unemployment figures, Labor shadow employment minister Martin Ferguson declared that the Job Network is taking a terrible toll on young people.
"They now have to contend with the difficulties of the common youth allowance and the fact that they are no longer entitled to any assistance from the government's hopeless Job Network", Ferguson said.
While the Labor opposition has criticised the way in which the tendering process for Job Network contracts have been carried out, however, it has remained mute on the question of what should replace the Job Network.