The Morrison government’s $4 billion JobMaker hiring credit scheme has been snubbed by employers, forcing Treasurer Josh Frydenberg to make changes to it in the upcoming May budget.
The scheme, which was expected to create a total of 450, 000 jobs in two and a half years, has so far failed to generate any real success, with only 521 jobs being created—far from the Treasury’s expectation of seeing 10,000 jobs by this stage. Currently, the hiring credit has had 15,000 registrations and paid out only $800,000 so far.
“While the JobMaker program is still in its early stages, given the take-up to date, the government will examine its criteria and settings in the context of the budget,” Frydenberg told the Australian Financial Review on Monday.
Announced in the October 2020 budget by the federal government, the JobMaker scheme aimed to help younger people obtain a job in the post-pandemic economy by rewarding employers $200 every week for a new hire aged 16 to 29 and $100 for a new hire aged 30 to 35.
This meant that employers could receive up to $10,400 for younger employees and $5200 for those aged 30-35 over a year. But employers must be eligible for the scheme, and they can only access the package if they hire young employees between Oct. 7, 2020 and Oct. 6, 2021.
The Treasury believes the slow uptake of the JobMaker scheme is due to the increasing levels of employment across the country.
Last week, the ABS released data showing that the country’s overall unemployment rate had decreased from 6.3 percent in January to an unexpected 5.8 percent in February, which is only 0.6 percent points above the March 2020 figures.
“In February, the unemployment rate fell from 6.3 per cent to 5.8 per cent, with 88,700 jobs created. Importantly, more than 40 per cent of these jobs went to young people,” Frydenberg reportedly told the Australian. “Employment is now back at pre-pandemic levels while the participation rate remains at a record high … These factors have contributed to fewer businesses taking up the credit.”
Frydenberg also said that while there would be some changes to the scheme’s eligibility criteria, he insisted that the 16 to 35 age limit for workers remains unchanged.
Jim Chalmers, the opposition treasury spokesman, said last year that it is vital that the new wage subsidy scheme is “better designed, better implemented and better monitored than JobKeeper,” which will end on March 28.