Why COVID job subsidy can’t be a keeper
Ending the JobKeeper wage subsidy in March will stop zombie companies which won't recover being propped up, and encourage CBD workers who lost their jobs to consider regional work, top Treasury figures are saying.
Some regional employers, including on the Sunshine Coast, say they are struggling to find workers, and have even had people seemingly reject job offers in favour of JobSeeker.
JobKeeper started being wound back in September, dropping back to $1200 a fortnight in September with businesses needing to reapply, while it will step back to $1000 in January before ending in March.
Treasury secretary Steven Kennedy said it would important for the wage subsidy to taper down, saying government should look to "incentives to hire people, rather than hang on to people".
Dr Kennedy said that while CBDs had been particularly badly hit, there were reports of some regional areas that were rebounding strongly and even discussions of labour shortages.
"If you were waiting to go back to work because you thought things were going to reopen, you might not be ready to uproot yourself and take up the job appearing in regional Australia," he said.
"We will have to be careful in the application of JobSeeker. That's why I think it's appropriate that JobKeeper tapers off.
"That's part of, unfortunately, letting a business adjust here to allow another business to soak up that labour."
Outgoing Finance Minister Mathias Cormann said keeping JobKeeper going over an extended period would mean pumping cash to support businesses that otherwise would not have a viable future in the new normal.
"If we didn't allow that adjustment to take place, the economic recovery would be slower and weaker than we would want it to be and than it could be," he said.
Owner of Sunshine Coast-based The Attic cafe Ian Masterman said he had struggled to hire just one full-time employee, despite advertisements on Facebook, radio stations and hiring agencies.
"I've had people drop resumes in and I've emailed them two days later and then a month later they've gotten back to me saying, 'Oh, you still want me to come in, I've just seen this' - that was coincidentally after JobSeeker changed," he said.
"A lot of them are not really looking for work."
Cordwells Concrete boss David Cordwell said he had been struggling to fill a range of roles, including diesel fitters, boiler makers and truck drivers.
"The few people I've said you can have a job too, basically they find an excuse on why they can't start," he said.
"It amazes me with the employment rate where it is that more people aren't applying."
Shadow treasurer Jim Chalmers has said the Government has prematurely started withdrawing JobKeeper, pointing to falls in retail trade and payroll data in late September.
"Decisions taken by the Liberals and Nationals mean that the Morrison Recession will be deeper than necessary and the unemployment queues longer than they need to be," he has said.
Originally published as Why COVID job subsidy can't be a keeper