Access to decent work is critical to productivity

"We have an inefficient outsourced fragmented social security compliance management system that sometimes gets someone a job against all odds."

So began the report of the parliamentary inquiry into Australia's employment services in 2023. This stark finding prompted relief that the federal government would finally tackle one of our most dysfunctional and unproductive human service systems - but two years, on we are still waiting for the system to be overhauled.

More than one million Australians are looking for work. Some will find employment quickly, but for those who experience months or years of joblessness, the financial and social impacts are devastating. Unemployment affects almost one in five families, undermining health, housing security and children's education. The federal government spends nearly $2 billion annually contracting 114 service providers to deliver several different employment programs, including Workforce Australia and the youth-specific Transition to Work program. These providers are contracted to help people find secure, decent work - yet only one in five people who go through the employment services system manage to gain and stay in a job for six months.

By building a complex system of financial incentives and compliance to steer providers and participants, successive governments have created an inflexible system that is a poor match for the diversity of our workforce today and into the future. Too much energy and money is spent on making people jump through hoops instead of providing the help they need to find work - a situation at odds with the focus on improving productivity. This is a system that, in the Parliament's words, has been choked by compliance.

Through BSL's work in communities across Australia, we see the transformative power of decent, secure jobs. Employment services should be a bridge to economic participation and social inclusion. Instead, they have become a compliance machine. A ticker of boxes, instead of a driver of outcomes.

BSL works in partnership with the Victorian and federal governments and philanthropic partners to provide employment supports in Broadmeadows and Frankston, not funded through the mainstream employment services system. Through this we meet many people who have been through a frustrating, unhelpful system that often pushes them to do what suits the provider. We hear too many stories of sporadic online check-ins instead of face-to-face help, training courses that don't suit the participant, and an ever-changing lineup of service staff who are meant to provide mentoring but lack the time and skills.

Take the young person who wanted to pursue a pre-apprenticeship in construction. Instead of being supported to build these skills Australia needs, he was pressured by his employment service provider into a Certificate III course that would have provided a bigger financial incentive to the provider. While he had every right to undertake a pre-apprenticeship, he was incorrectly told this would risk his income support payments being suspended. He experienced a service that did not suit the young person or local businesses looking for staff - but was paid for by the taxpayer.

Or the 19-year-old living with her mother after family violence. She was promised help with identity documents and skills development. Instead, her appointments were reduced to 10-minute phone calls tracking job applications. No support with recovery, no confidence building, no resume support, no interview practice or tailored support.

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These are not isolated cases. They are symptoms of a system that traps people in poverty rather than unlocks potential, leaving people frustrated, disengaged, and no closer to decent work. Behind the statistics are real people whose lives are being shaped - and often harmed - by a system built around compliance, not capability.

It is not only job seekers who are failed. Very few employers are using Workforce Australia services, despite facing skill shortages and in need of support to find staff need across critical jobs roles, including in care, construction and manufacturing. Employment services can and should work for jobseekers and for employers.

The federal government has had the findings of the parliamentary review for two years. The review made it clear that cosmetic tweaks to contracts or programs will not fix the dysfunction. Bold system reform is the only course of action consistent with Australia's productivity agenda and the goal of full employment. This could be a signature economic reform that improves Australia's future prosperity.

Reform must change how and who government contracts to deliver services, remove punitive measures that penalise jobseekers, ensure support is available when and where people need them and build a system around capability, not compliance.

Employment services are not just about getting people into jobs. They are about building lives, strengthening communities, and driving national productivity. After two years of delay, comprehensive reform has become even more essential.

Australia is ready to do the hard work, so let's get started.