TO PUSH ITS radical welfare reform agenda, the federal government is using familiar political fuel: fear. It warns of dire economic consequences if skill shortages are not addressed and it advocates reform of Australia's income support system as one key to solving the
skill shortage "crisis".
There is no general skill shortage crisis in South Australia or Australia. This is set to happen next decade, when the rate of retirement of the baby boom generation accelerates and the entry of young people into the workforce slows.
The current skills problem is limited to occupational areas and driven by the housing and construction boom, which will slow down significantly over the next 12 months. Yet the government is aggressively promoting fears that Australia is gripped by a general skill shortage crisis.
Meanwhile, the government is not focusing enough on the need to overcome skill shortages through longer-term planning and investing more in
education and training. Rather, it has created scapegoats for current skill shortages - people receiving Disability Support Pension (DSP) and
Single Parenting Payment (SPP).
It is politically convenient for the government to link the lower workforce participation of these groups with the skill shortage debate
as it allows the government to pursue its welfare reform agenda under the guise of a skill shortage strategy.
This is creating the false impression that many of the 700,000 Australians on DSP and 450,000 Australians on SPP is a work-shy reserve army of labour that should be compelled to work.
The federal government appears determined to use the irrational debate about skill shortages to drive its broader radical welfare reform agenda. It suggests that one of the solutions to skill shortages is to increase the workforce participation rates of people on DSP and SPP.
People on DSP have often been unemployed or under-employed for a long time and lack the necessary skills, capacity and experience to secure and retain regular employment.
It is unrealistic to expect people with a marginal attachment to the workforce to help solve short- term skill shortages, particularly ones that require qualifications, high skills and experience. It normally takes up to four years to complete a skilled trade qualification.
An extensive program of support including pre-vocational training and access to employment and other support services is necessary to help
people on DSP, who have been outside the labour market for a long time, make successful transitions to paid work.
The government wants to compel single parents receiving SPP to work as soon as their children are of school age. Single parents on SPP are not
likely to be in a position to do much paid work, due to the burden for family care and home duties. There is no talk of a package of assistance to make this possible, just the threat of loss of benefits. This does not accord with the government's commitments to a family-friendly policy.
The irony of the push by the federal government to compel many people on DSP to work is that it has done the opposite for many years. Over the
early years of the decade, when jobs were scarce, it shifted thousands of people from unemployment benefits to disability support pensions. This bought the unemployment rate down without creating one job. Having hidden thousands of unemployed people behind the disability support pension, they now expect them to actively look for work. Many of these people have experienced a long time out of the workforce and they do not have the experience, skills or qualifications to fill current skill
The government looks set to impose new job search requirements on DSPc and SPP recipients in the May budget. These changes will place an unfair burden of responsibility on groups that are particularly disadvantaged in the labour market. These people need supportive policies that make workforce participation a realistic option, rather than punitive policies, which blame the victim while ignoring the real causes of skill shortages.
Skill shortages will not be solved by compelling people on DSP and SPP to participate in the workforce. What is really needed is a comprehensive National Workforce Development Strategy, which intelligently distinguishes between the multiple causes of skill shortages and assists, rather than compels, workforce participation.
The solution to skill shortages is intelligent workforce planning, backed by increased investment in education and training by business and government.