"The Exposure Draft for Employment Services 2015–2020 released today makes welcome improvements, but more detailed engagement with industry is needed to address shortcomings in the current system," Business Council of Australia Chief Executive Jennifer Westacott said.

“While many aspects of the new model are welcome, such as the clearer targeting of assistance at people most in need, and the focus on rewarding job outcomes, further action is needed to find the right balance in connecting jobseekers with the job opportunities that employers have to offer.

"The Business Council wants to see disadvantaged jobseekers including young people, Indigenous Australians  and the long-term unemployed receive effective support as well as strong incentives to become job-ready and find pathways into work.

"As the Building Australia’s Comparative Advantages paper released today makes clear, in order for Australia to be competitive in the global economy we need a purposeful approach to matching the skills and capabilities of our workforce with those required by business. 

"It is important to keep in mind that the state of the economy is by far the most important factor in getting people into work, and that to create the opportunities for people to find work we need strong economic growth.

"The BCA has previously called for a rethink of the JSA arrangements to create incentives to better match jobseekers with long-term jobs. The package goes some way to addressing this, however it’s important to get the incentives right so that the system does not create unintended consequences, particularly when combined with the Newstart restrictions announced in this year’s Budget.

“We are concerned about the practicality of asking people to apply for 40 jobs each month in the current softening labour market . It would be better to allow jobseekers to concentrate their efforts towards applying for the jobs they have the best chance of acquiring.

“The proposed increased focus on rewarding job outcomes is positive a step, but some of the outcome payments – such as a payment at 4 weeks employment – don’t match up with what we know about sustainable employment outcomes. 

"The outcome payment schedule for employment services needs to incentivise properly matching and skilling jobseekers for actual jobs, and supporting them to stay in those roles. We can't have a system that rewards churn.

"The BCA wants to see more detail on how job service providers will improve connections with employers, for example by using job brokers to better match candidates with emerging opportunities. 

"We need a job services system built on evidence about what really works. The 'Work for the Dole' scheme needs to avoid the well-known risks that such participation actually makes people less likely to move off welfare and must lead to meaningful jobs for people.

“The BCA is eager to sit down with government to help devise a model that is clearly focused on what we know about the labour market of today and tomorrow,” Ms Westacott said.