Job Ops for Young Kiwis
Creating job opportunities for young people is the focus of the Government's new Job Ops scheme, says Social Development and Employment Minister Paula Bennett.
Job Ops targets unskilled 16 to 24 year olds with low or no qualifications who have limited employment opportunities. It will pump $20 million into funding around 4000 entry-level jobs.
This age-group currently make up around one-third of all those on the Unemployment Benefit. Ms Bennett says this is a new approach.
"It's about young people, businesses and the Government working together.
"We know the younger a person is when they first go on the Unemployment Benefit, the more likely they are to stay on it. We simply don't want our young people languishing there. We owe it to them to do everything we can to maximise their employment potential - and that's what Job Ops will do," Ms Bennett says.
She says the business community will be asked to play its part in helping address youth unemployment with this package.
"This is a win for everybody. Young people will get the chance to build their work experience while small-to-medium sized businesses will be supported to fill entry roles with limited risk. We're now looking to employers to come forward with jobs."
Job Ops will subsidise employers $5000 for each young person hired into an entry level position for six months.
This consists of an upfront payment of $3000, with a further $2000 paid once the person has completed six months in the job.
"We want to help young people into jobs wherever possible. Job Ops will give them a chance to get off the benefit and into work for six months, boosting their employability into the future.
"This is a short-term, targeted solution to a very real problem facing New Zealand. Our young people deserve job opportunities and we're delivering those through Job Ops," Ms Bennett says.
Job Ops will finish in December 2010.
Facts about youth unemployment (at June 2009)
- Almost 17,000 16 - 24 year olds were on the Unemployment Benefit.
- This is up from under 4000 (at June 08).
- Sixteen to 24 year olds made up one third of all people on an Unemployment Benefit for that same period.
- Of those 16 - 24 year olds, 35 per cent were rangatahi and 12 per cent were Pacific people this means nearly half (47%) of all young people receiving an UB were Mori and Pacific Island youth.
- 35 per cent of all Mori receiving the Unemployment Benefit were 16 - 24 years.
- 38 per cent of all Pacific people receiving Unemployment Benefit were 16 - 24 years.
- 30 per cent of all Pkeh receiving the Unemployment Benefit were 16 - 24 years.
Questions and answers
What kind of businesses can take advantage of Job Ops?
Most businesses with entry-level jobs. If they are already receiving assistance such as Industry Partnership funding or the Skills Investment Subsidy, they may be a lower priority in areas of high demand.
How can businesses go about applying?
First they need to call 0800 778 008 to see if they are eligible.
Will an employer be expected to provide formal training to the young person on the job?
No, we don't want to make this onerous for employers. But in providing a job, employers will be expected to work with the young person to build work skills and foster confidence and, where appropriate, provide them with references for future work.
Who is eligible for Job Ops?
A person who is 18 to 24 and had low skill levels or work experience will be eligible if they are on the Unemployment Benefit while a 16 or 17 year old will automatically be eligible after an assessment by Work and Income.
If an employer hires a young worker for six months as part of Job Ops doesn't that put other workers at risk of being displaced?
Work and Income will manage the relationship closely to ensure the Job Ops role is significantly different to the role of a person who may have been made redundant. This is about giving young people a chance at a job - the focus will be on entry level roles. This expectation will be made clear to employers.
Work and Income has discretion to refuse an application if they believe the employer is not acting in good faith.
How does the Government payment work?
The employers will sign a short contract with Work and Income - $3000 is paid upfront and $2000 at the end of the contract.
What are the employer's requirements?
The young person must be paid at least the minimum wage and all employment legislation complied with.
Can the young person work for more than 30 hours a week?
Yes but the Government contribution will stay at $5000 so the employer would receive no contribution for the additional wage.
Doesn't Job Ops benefit larger employers who may be able to take advantage of the scheme more easily?
Job Ops is for all employers. Its focus is on helping unskilled young people get a job - the fact businesses will benefit from this is great, but the most important thing is giving those young people more opportunity to work.
In regions with a lot of applications, Work and Income might need to prioritise where support is provided. In these cases employers not receiving government assistance such as the Skills Investment Subsidy or Industry Partnership would get priority.
Are seasonal employers eligible for Job Ops?
It is not intended to be used by seasonal employers - the focus is on creating new positions for young unemployed people rather than using these people to fill pre-existing vacancies.
What if not enough businesses take up this offer?
We're setting aside money for up to 4000 Job Ops places - it's now up to employers to come forward with opportunities.
We think this will appeal to employers who were worried about the financial risk of taking on another employee. By paying half the wages we are sharing that risk.
Work and Income job brokers will also be working very hard in their communities to identify potential employers and help find new job opportunities.
How does the money a young person gets under Job Ops compare to the Unemployment Benefit?
A young person on either Community Max or Job Ops will receive at least $375 a week before tax in wages (the minimum wage for 30 hours a week.) That compares to an average unemployment benefit payment of $174 a week for people in this age group.
How does the cost of Job Ops to the Government compare with the cost of the Unemployment Benefit?
It depends on the individual circumstances of the young person and the assistance they may be entitled to. The following example may be useful:
A young person, aged 22 receiving the unemployment benefit at a net rate of $158.65 a week, would cost the government $8,249.80 a year. Whereas a young person who goes through 6 months of the Job Ops programme and is then taken on by that employer for unsubsidised full-time work would cost the government $5000 over the year.
What if a young person leaves the Job Ops contract because they've got another job?
Work and Income would still pay the employer the final $2000 payment if a young person leaves for another job, training or positive opportunity in the last four weeks.
Can a young person move from one Job Ops role to another in a different firm?
Yes.
Can they be rehired in a Job Ops role in the same firm consecutively?
No.
Can an employer take on more than one person?
Yes, if they are genuine entry-level roles which are not filled by existing staff.
Will employers taking part in Job Ops be obliged to keep the workers on after six months?
No but it is hoped, and potentially likely, that in some instances there may be ongoing work for the young person. In some cases this could, for example, take the form of an apprenticeship.
If a young person doesn't get a job after six months can they go back on the Unemployment Benefit and will usual stand down times apply?
Yes, normal processes for applying for an Unemployment Benefit will apply but the person will have a case manager who will work closely with them to look for other opportunities to work or engage in further training or education.
What would happen to the payment to the employer, if a participant drops off the programme to take up work, or go on to a benefit?
It depends on when the participant leaves the programme. If they left within the first six weeks then the employer has to give back the $3,000 less $192.31 for each week the participant was with them. If they leave after the first six weeks then the employer keeps the $3000
If the young person leaves within the last 4 weeks to go to a job, or training then the employer would still qualify for the $2000 final payment. If the young person leaves before the last 4 weeks or if they leave within the last 4 weeks to return to benefit then this final payment would not be made.
Would the participant be able to go onto a benefit if they voluntarily left the programme?
Yes, but there would be a stand-down as the person would have voluntarily left employment. The length of the stand-down would depend on the individual circumstances.