Active labour market programmes play a critical role in narrowing the gap in employment outcomes between Indigenous and non-Indigenous Australians. This chapter provides an overview of recent employment trends for Indigenous Australians, considering a range of labour market indicators. It outlines recent national government initiatives to strengthen the delivery of employment services. Drawing on lessons from local case studies, this chapter also outlines key principles to better connect Indigenous Australians to jobs.
Indigenous Employment and Skills Strategies in Australia
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Chapter 2. Connecting Indigenous Australians to Jobs
Abstract
Recent labour market trends in Australia
Significant employment gaps exist between Indigenous and non-Indigenous Australians
Australia’s labour market remains quite robust with a number of indicators pointing to a strong employment environment. Since October 2017, full-time employment has increased by 238 800 persons, while part-time employment has increased by 69 400 persons. Looking at the macro-level trends, Australia appears to be moving towards a situation of full employment, however this masks the disparities that exist between Indigenous and non-Indigenous Australians. In 2016, there was a gap of 19.9 percentage points in terms of the labour market participation rate, which is the proportion of the working age population aged 16-64 currently employed or seeking employment. This gap in labour market participation has not improved looking at the ten-year period between 2006-2016 (see Figure 2.1).
Figure 2.1. Labour market participation rate, Indigenous and non-Indigenous Australians, 2006, 2011 and 2016
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Note: In the 2016 Australian census, there were three census categories for Indigenous status: Aboriginal and/or Torres Strait Islander, “Non-Indigenous”, and “Indigenous status not stated”. 1.4 million Australians (out of the total population of 11.9 million Australians) category “Indigenous status not stated” in 2016. That category is not included in this figure.
Source: Australian Bureau of Statistics (2016), “Aboriginal and Torres Strait Islander Peoples Profile”, 2016 Census of Population and Housing, Catalogue no. 2002.0, available at http://www.abs.gov.au/websitedbs/D3310114.nsf/Home/2016%20Census%20Community%20Profiles.
When analysing the labour market participation rate for Indigenous Australians by age and gender, data show that, similar to the overall population, females were more likely than males to be out of the labour force across all age groups (see Figure 2.2). This is especially the case when looking Indigenous Australians aged 25-44 years – Indigenous males had a labour market participation rate of 69%, which was 10 percentage points higher than Indigenous females. When considering urban versus rural regions in Australia, about 50% of the Indigenous Australian population in non-urban areas were not in the labour force, compared to 43% in urban areas.
Figure 2.2. Labour market participation rate by age and gender, Indigenous Australians, 2016
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Note: In the 2016 Australian census, there were three census categories for Indigenous status: Aboriginal and/or Torres Strait Islander, “Non-Indigenous”, and “Indigenous status not stated”. 1.4 million Australians (out of the total population of 11.9 million Australians) fell in the category “Indigenous status not stated” in 2016. That category is not included in this figure.
Source: Australian Bureau of Statistics (2016), “Aboriginal and Torres Strait Islander Peoples Profile”, 2016 Census of Population and Housing, Catalogue no. 2002.0, available at http://www.abs.gov.au/websitedbs/D3310114.nsf/Home/2016%20Census%20Community%20Profiles.
Employment rate trends, which consider the share of employed people out of the working age population, show a large gap between Indigenous and non-Indigenous Australians. The employment rate is a useful method for evaluating the health of a country’s labour market, considering that a high employment rate generally has a positive impact on a country’s GDP. The gap in the employment rate between Indigenous and non-Indigenous Australians has increased in the last decade from 23.7 percentage points in 2006 to 25.2 percentage points in 2016 (see Figure 2.3).
Similar to the differences in labour market participation and employment rates between 2006-2016, the gap in the unemployment rate has increased from 10.5 to 11.6 percentage points (see Figure 2.4). In 2016, Indigenous Australians had an unemployment rate of 18.4%, which is nearly three times higher than that of the non-Indigenous population (Australian Bureau of Statistics, 2016[1]). Unemployment rates for Indigenous Australians generally decrease with age. Unemployment rates were highest among Indigenous Australians aged 15 to 24 years (27%) and lowest for those aged 65 years and over (7%). Looking across all age groups, the unemployment rates of Indigenous Australians are significantly higher than the non-Indigenous population. The biggest gap is for young people aged 15 to 24 years (27% for Indigenous Australians, compared with 14% for the non-Indigenous population) (see Figure 2.5).
Figure 2.3. Employment rate, Indigenous and non-Indigenous Australians, 2006, 2011 and 2016
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Note: In the 2016 Australian census, there were three census categories for Indigenous status: Aboriginal and/or Torres Strait Islander, “Non-Indigenous”, and “Indigenous status not stated”. 1.4 million Australians (out of the total population of 11.9 million Australians) fell in the category “Indigenous status not stated” in 2016. That category is not included in this figure.
Source: Australian Bureau of Statistics (2016), “Aboriginal and Torres Strait Islander Peoples Profile”, 2016 Census of Population and Housing, Catalogue no. 2002.0, available at http://www.abs.gov.au/websitedbs/D3310114.nsf/Home/2016%20Census%20Community%20Profiles.
Figure 2.4. Unemployment rate, Indigenous and non-Indigenous status, 2006, 2011 and 2016
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Note: In the 2016 Australian census, there were three census categories for Indigenous status: Aboriginal and/or Torres Strait Islander, “Non-Indigenous”, and “Indigenous status not stated”. 1.4 million Australians (out of the total population of 11.9 million Australians) fell in the category “Indigenous status not stated” in 2016. That category is not included in this figure.
Source: Australian Bureau of Statistics (2016), “Aboriginal and Torres Strait Islander Peoples Profile”, 2016 Census of Population and Housing, Catalogue no. 2002.0, available at http://www.abs.gov.au/websitedbs/D3310114.nsf/Home/2016%20Census%20Community%20Profiles.
Figure 2.5. Unemployment rate by age comparing Indigenous and non-Indigenous Australians, 2016
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Note: In the 2016 Australian census, there were three census categories for Indigenous status: Aboriginal and/or Torres Strait Islander, “Non-Indigenous”, and “Indigenous status not stated”. 1.4 million Australians (out of the total population of 11.9 million Australians) fell in the category “Indigenous status not stated” in 2016. That category is not included in this figure.
Source: Australian Bureau of Statistics (2016), “Aboriginal and Torres Strait Islander Peoples Profile”, 2016 Census of Population and Housing, Catalogue no. 2002.0, available at http://www.abs.gov.au/websitedbs/D3310114.nsf/Home/2016%20Census%20Community%20Profiles.
Indigenous Australians face disparities in income
Table 2.1 illustrates that both the median personal income and the total household income of Indigenous Australians in 2016 was substantially lower than that of non-Indigenous Australians. For example, there was a gap of AUD 227 per week in median total personal income. Looking at median total household income, meanwhile, non-Indigenous Australians earned on average AUD 243 more per week than Indigenous Australians. This gap has been relatively stable since 2006. The Australian government has highlighted how low income is often associated with a wide range of disadvantages including poor health, shorter life expectancy, poor education, substance abuse, reduced social participation, crime and violence (Department of Prime Minister and Cabinet, 2014[2]).
Table 2.1. Personal and household income, Indigenous and non-Indigenous Australians, 2016
Households with Aboriginal and/or Torres Strait Islander persons |
Non-Indigenous persons/ other households |
|
---|---|---|
Median total personal income (AUD/weekly) |
441 |
668 |
Median total household income (AUD/weekly) |
1 203 |
1 446 |
Source: Australian Bureau of Statistics (2016), “Aboriginal and Torres Strait Islander Peoples Profile”, 2016 Census of Population and Housing, Catalogue no. 2002.0, available at http://www.abs.gov.au/websitedbs/D3310114.nsf/Home/2016%20Census%20Community%20Profiles.
Low-income status is related to the jobs in which Indigenous Australians are employed
Indigenous Australians tend to work service-related sectors. For example, in 2016, more than 55% of the total employment of Indigenous Australians was concentrated in four sectors, these include Health Care and Social Assistance (15.3%), Public Administration and Safety (11.7%), Education and Training (10%) and Retail Trade and Construction (9.4%) (Figure 2.6). Considering knowledge-based industries, Indigenous Australians are less likely to be employed in Professional, Scientific and Technical Services, and in the Financial and Insurance Services occupations. In 2016, these industries represented about 4.0% of total employment for Indigenous Australians. When comparing the sectoral distribution of employment among Indigenous Australians between 2011-16, these trends have remained relatively the same over this five-year period.
Figure 2.6. Employment by industry comparing Indigenous and non-Indigenous Australians, 2016
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Note: Non-Indigenous Identity also includes persons who did not specify an identity within the 2016 Census (the category "Indigenous Status Not Stated").
Source: Australian Bureau of Statistics, Census of Population and Housing, 2016.
The world of work is changing and some occupations are likely to face increasing risk of automation and job destruction going forward. About 36% of Australian jobs face a significant or high risk of automation. While this is less than the OECD average (46%), it means that a sizeable share of adults will need to upskill or retrain to meet the needs of future jobs (OECD, 2019[3]). OECD research has also showed that the jobs most likely to be automated are those occupations that generally require lower levels of skills (OECD, 2018[4]).
When looking at occupational data, Indigenous Australians generally work in less-skilled occupations compared to the non-Indigenous population. They have lower shares of employment as Managers and Professionals and higher shares of employment as Machinery Operators and Drivers Labourers (Figure 2.7). When looking at medium-skilled occupations, the share of Indigenous employment is particularly high in Community and Personal Service Workers occupations (17.6% vs. 10.9% for non-Indigenous Australians in 2016). Trends over time also show that the gap between Indigenous and non-Indigenous Australians has decreased in the other medium-skilled occupations, such as Technicians and Trades Workers, Clerical and Administrative Workers and Sales Workers. The difference was over 1 percentage point for each occupation in 2011 and less than 0.7 percentage points in 2016.
Figure 2.7. Employment by occupation comparing Indigenous and non-Indigenous Australians, 2016
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Note: Non-Indigenous Identity also includes persons who did not specify an identity within the 2016 Census (the category "Indigenous Status Not Stated").
Source: Australian Bureau of Statistics, Census of Population and Housing, 2016.
National policies and programmes supporting better Indigenous employment outcomes
Improving Indigenous employment is a national priority for the Australian Government. In acknowledgement of this, responsibility for Indigenous specific policy and services within the Australian Government sat with the Department of the Prime Minister and Cabinet until 1 July 2019 and now sits within the newly established National Indigenous Australians Agency. However, a range of national departments also play a critical role in contributing to the employment outcomes of Indigenous Australians, including the Department of Employment, Skills, Small and Family Business, the Department of Education, the Department of Human Services, the Department of Social Services, and the Department of Heatlh.
Labour market and skills policies are generally developed by the Department of Employment, Skills, Small and Family Business. Consultation takes place in the form of meetings, requests for written input, and interdepartmental committees. A number of relevant Australian Government departments, including central agencies are normally consulted in the development of labour market policies. The Australian Government also regularly consults with other levels of government, key stakeholders, including Indigenous representative bodies, and the public through a range of mechanisms including public consultation processes. The approaches taken on these consultations may vary depending on the nature of the issue, the relevant interested partners and the coordinating areas.
Refreshing the Closing the Gap Targets
Under the Closing the Gap initiative, the Australian government has set a series of targets with the goal of reducing disparities between the Indigenous and non-Indigenous population. To monitor change, the Council of Australian Governments (COAG), a key intergovernmental forum in Australia between Commonwealth, State and Territory governments, set measurable targets in 2008 to monitor improvements in the health and wellbeing of Indigenous Australians. This included halving the gap in employment by 2018. While this employment gap target was not met, the Prime Minister’s recent 2019 Closing the Gap progress update notes that the government is committed to continuing to build evidence around what works to improve Indigenous outcomes (Department of the Prime Minister and Cabinet, 2019[5]).
In December 2018, COAG agreed to a new set of targets under the Closing the Gap Refresh. Part of the refresh included putting Indigenous Australians at the heart of the development and implementation of the next phase of Closing the Gap. A Special Gathering of prominent Indigenous Australians presented COAG with a statement setting out priorities for a new Closing the Gap agenda to be guided by the principles of empowerment and self-determination and deliver a community-led, strengths-based strategy that enables Indigenous Australians to move beyond surviving to thriving (COAG, 2018[6]). The refreshed framework recognised that:
“one level of government may have a greater role in policy and program delivery in relation to a particular target while another level of government may play a greater role in funding, legislative or regulatory functions. Meeting specific targets will require the collaborative efforts of the Commonwealth, states and territories, regardless of which level of government has lead responsibility”. (COAG, 2018[6]).
In March 2019, A Closing the Gap Partnership Agreement was announced, which is a formal agreement between Commonwealth, state and territory governments, the National Coalition of Aboriginal and Torres Strait Islander Peak Organisations, and the Australian Local Government Association. At the heart of this approach was the establishment of the Joint Council on Closing the Gap, which includes ministers from each jurisdiction, twelve members of the National Coalition of Aboriginal and Torres Strait Islander Peak Organisations, and one representative of the Local Government Association. Under this agreement, it is acknowledged that:
“This new and formal partnership builds on the progress over the past 10 years under Closing the Gap and is a commitment to fundamentally change the way that governments and Aboriginal and Torres Strait Islander people work together in order to accelerate improved outcomes” (COAG, 2019[7]).
In the area of employment, draft targets have been agreed with an outcome statement that Indigenous Australians will experience equality, opportunity and economic prosperity. To support this outcome, the draft COAG target aims for 60% of Indigenous Australians aged 25-64 years to be employed by 2028. It should be noted that these draft targets are still subject to finalisation through a partnership with Indigenous Australians representatives. That being said, the refreshed Closing the Gap emphasises the importance of co-designed policies and programmes. To this end, the Australian Government announced the Closing the Gap – Employment Services package under the 2017-18 Federal Budget, which included a number of new measures designed to increase employment outcomes for Indigenous Australians. One of these measures included piloting a community-delivered employment services model in the Yarrabah community of Queensland, where there are approximately 700 Indigenous job seekers (see Box 2.1).
Box 2.1. Towards a place-based approach to employment: The Yarrabah Employment Pilot
The Australian Government has invested in a trial of a place-based employment services model in the Indigenous community of Yarrabah in northern Queensland. The trial has established a new local community organisation to deliver employment services to the community. The Australian Government committed an additional AUD 5 million for a flexible funding pool available to support the delivery of the model, assist in building capacity of the service provider and deliver local employment and economic development projects.
Yarrabah was chosen for the pilot programme because it is the largest regional or remote Indigenous community in Australia. It is close to the major employment market of Cairns, and consultations with the community initiated the proposal. The Yarrabah community has an official population of 2 566 people. However, Yarrabah Aboriginal Shire Council estimates a total population closer to 4 000 people - noting the high level of transience that occurs.
The objectives of the trial are to respond to the needs of the Yarrabah community, to build its capacity to inform and set service delivery priorities. The trial presents an opportunity to test different approaches to the delivery of employment services for Indigenous Australians. Success under the trial may include an increase in community empowerment, an increase in employment outcomes, an increase in community members filling jobs in the community, greater engagement by job seekers in the service, increased school attendance and greater community cohesion.
The Australian Government launched the trial on 2 July 2018, following a community co-design process. Key elements of the model include local community leadership, culturally appropriate service delivery, community involvement in decision-making, targeting the interests of participants and linkages to training, employment or a social outcome.
Wugu Nyambil (‘holding onto work’) delivers the service and is the result of a partnership between the Yarrabah Council and the Department of Employment, Skills, Small and Family Business. The community-delivered services have more Indigenous staff and a better understanding of the challenges facing Indigenous job seekers, and will build the capacity of the Yarrabah community to assist those looking for work. Staff members are either residents of Yarrabah or have a very close connection to Yarrabah.
As of 31 January 2019, there are around 680 job seekers participating in the pilot. The provider, Wugu Nyambil, has sourced a number of job vacancies with employers and placed around 50 job seekers into employment while creating various activities for job seekers in the local labour market. Such activities include cooking, sewing, cultural art and craft, animal management, army reserve survival skills, accredited training in construction and rural operations, garden and property maintenance, skills for education and employment program (e.g. language, literacy and numeracy training), life guard and security guard courses; and assisted almost 100 job seekers to obtain or renew their driver’s licence.
jobactive is a main employment programme that aims to get people into work
jobactive is the main employment services programme, which features a network of service providers in over 1 700 locations across non-remote Australia, delivering employment support programmes and services for all job seekers, including Indigenous Australians (Department for Employment, Skills, Small, and Family Business, 2019[8]). Under jobactive, job seekers receive assistance to improve their job readiness, and employability skills and employment applications. Service providers match job seekers with suitable work experience placements including through compulsory activities such as the Work for the Dole programme. Providers also support jobseekers and their employers once placed in a job, by giving access to other types of supports, including wage subsidies and or relocation assistance, and ensure that all job seekers are treated fairly and with respect in a culturally sensitive way.
Alongside jobactive, which is accessible to all Australians looking for work, the government funds employment programmes targeted to people with disabilities and youth. Disability Employment Services (DES) is managed by the Department of Social Services, with the goal to help people with disability find work and keep a job. DES providers are a mix of large, medium and small, for-profit and not-for-profit organisations that are experienced in supporting people with disability as well as providing assistance to employers to put in place practices that support the employee in the workplace.
Transition to Work (TTW) is an employment service to support young people aged 15-21 in getting a job. TTW is managed by the Department of Employment, Skills, Small and Family Business and from January 2020, this programme will be expanded to include 20-24 year olds. It provides intensive, pre-employment support to improve the work-readiness of young people and help them into work (including apprenticeships and traineeships) or education.
Providers are paid to get people into work
jobactive is designed to cater to the intensity of services to the level of disadvantage faced by the job seekers. As such, job seekers are assigned to a Stream A, B or C based on the possibility of them finding work on their own. An individual is assigned to a stream based on the Job Seeker Classification Instrument (JSCI). The JSCI (also known as the ‘Job Seeker Snapshot’) is a questionnaire used to measure a job seeker’s relative difficulty in gaining and maintaining employment. The JSCI helps identify what level of support the job seeker will need to help them find work and identifies those job seekers who have complex or multiple barriers to employment that need further assessment (Department of Employment, Skills, Small, and Family Business, 2019[9]). Job seekers complete the JSCI when they first register for employment assistance with the Department of Human Services (DHS) through Centrelink and any time they experience a change in their circumstances. The JSCI responses help to determine the appropriate employment service provider for the job seeker.
jobactive’s performance management framework rewards employment outcomes
jobactive provides financial incentives for providers to support job seekers into employment through outcome payments which are paid when a job seeker gains employment and successfully remains in that job at 4, 12 and 26 weeks. To ensure providers deliver quality employment services and encourage best practice, providers delivering services under jobactive are subject to a comprehensive performance management framework. This includes a robust methodology (referred to as Star Ratings) assessing the provider’s performance and comparing the provider’s performance against other employment service providers, at the provider and local level. jobactive takes into account the differences in labour market conditions and the relative disadvantage of job seekers on the provider’s caseload. There are a range of specific performance indicators related to achieving employment outcomes for Indigenous and non-Indigenous job seekers (see Box 2.2).
Box 2.2. jobactive Performance Management Framework
The Star Ratings inform job seeker and employer choice as well as the business review and reallocation processes. Performance is calculated against six performance measures for each Stream. Job seekers, under jobactive, are assigned to Stream A, B or C based on their assessed level of disadvantage (with A being less disadvantage to C being the most disadvantaged job seekers).
Performance Measures and Weightings |
|
---|---|
Performance Measure |
Weightings |
26 Week Outcomes – All Job Seekers |
50% |
26 Week Outcomes – Indigenous Job Seekers |
10% |
26 Week Outcomes – Time to Placement |
10% |
12 Week Outcomes |
10% |
Work for the Dole Phase – Participation |
10% |
Time to Commence in Work for the Dole / Activity |
10% |
For five of the six performance measures, regression analysis determines the performance levels which could reasonably have been expected given the individual characteristics of the job seekers assisted and the characteristics of the local labour market. Star Ratings are calculated quarterly and use a two-year rolling assessment period.
In 2017, the Australian Government announced the Closing the Gap – Employment Services package which included an increase in the weighting of Indigenous outcomes in the jobactive Star Ratings. It introduced the Indigenous Outcomes Incentive (IOI) to the Star Ratings from December 2017. As a result of the IOI, each jobactive provider’s Star Rating percentage is adjusted upwards (bonus) or downwards (demerit) based on the employment outcome rates it achieves for Indigenous job seekers compared with non-Indigenous job seekers on its caseload. This change increases the incentive for providers to implement strategies to help Indigenous job seekers find sustainable employment.
Source: Department of Employment, Skills, Small, and Family Business (2018), Job Active Performance Framework, available at https://docs.jobs.gov.au/documents/performance-framework-guideline (Accessed September 15, 2018).
The Employment Fund provides flexible funds to tailor employment services and supports
jobactive providers receive administration fees and can access the Employment Fund to pay for a number of goods and services, including training and other support to improve a job seeker’s job-readiness and help them succeed in employment. Through the Fund, jobactive supports access to services that address pre-employment needs, builds soft skills, addresses non-vocational barriers (e.g. health and psychological services), provides targeted employer required training, counsels and mentors applicants and delivers practical support to individuals such as assistance with transport or equipment needed in the workplace.
A jobactive provider must first pay for eligible purchases and then claim reimbursement through the Employment Fund. A provider must therefore ensure the purchase meets the Fund principles before purchasing goods and services, which include 1) provides eligible participants with the work-related tools, skills and experience that correspond with their difficulties in finding and keeping a job in the relevant labour market; 2) provides value for money; 3) complies with any work, health and safety laws that may apply; 4) withstands public scrutiny, and 5) will not bring employment services or the Government into disrepute (Australian Government, 2019[10]).
The future of employment services
The Australian Government has begun work on the development of a future employment services model for when the current jobactive arrangements end in mid-2020. To help shape the new model, an independently chaired Expert Advisory Panel was appointed in January 2018. The Panel includes a focus on Indigenous training and employment. Technological developments, a changing economy, and shifts in the way job seekers and employers connect mean the Australian Government needs to think differently about the design of future employment services. The new model will look to harness digital technology, enabling better targeting of enhanced services to those who need it most.
As part of this consultation, the views and experiences of a diverse range of Australians, including Indigenous job seekers, employers, and other stakeholders, was sought through both face-to-face and broad public discussion paper consultations in mid-2018. The new model, while needing to deliver generalist employment services, will be culturally competent, and designed to build capacity and empower Indigenous Australians. The recent 2019 Australian Budget announced a series of new measures on the future of employment services in Australia (see Box 2.3).
Box 2.3. The Australian Government’s new employment services model
The development of the new employment services model involved extensive consultation with more than 1 400 stakeholders including job seekers, employment services providers, industry representatives, employers and peak bodies, and independent advice delivered by the Employment Services Expert Advisory Panel in its report to Government. The new model is being piloted in two regions from July 2019 before being rolled out nationally from July 2022.
For job seekers, the new model will provide service options to support them to find a job, a better digital platform and more flexibility to meet mutual obligation requirements. Job seekers who are job-ready and digitally literate will enter Digital Services and self-service online. These job seekers will be able to access online tools to help them make informed choices about their job search, as well as a contact centre to help answer questions and provide advice via phone or email.
Job seekers in Digital Services who need extra support will be able to access digital services and receive additional support as needed. This may include training to help use the digital service, skills training, or funding to pay for a wage subsidy, tools or a licence. Job seekers may also engage with any other complementary programmes they are eligible for, such as PaTH Internships or Career Transition Assistance.
The most disadvantaged job seekers will receive Enhanced Services delivered through employment services providers. Providers will deliver a professional, individualised service to help prepare and support job seekers into work. Providers will help address a job seeker’s barriers to work through services such as career guidance, mentoring, vocational training, assistance in accessing non-vocational services such as counselling, work experience, job placements and post-placement support.
From July 2019 to June 2022, key elements of the new model will be piloted in Adelaide South, South Australia and Mid North Coast, New South Wales. The new settings will be tested and evaluated and enhancements made through a co-design process with providers, employers and job seekers. The department will work closely with providers in these regions to establish and deliver the pilots. Current jobactive contracts will be extended until June 2022 in all other regions, while elements of the new model are tested.
Indigenous Australians represent an increasing proportion of the jobactive caseload
The overall Australian labour market has shown some positive signs with unemployment sitting around 5.2%, which is the lowest level since 2012. This trend is reflected when looking at the overall jobactive caseload. When comparing the total caseload to the overall Australian labour force (see Figure 2.8), the caseload size moved from 6% in 2015 to 4.7% in the first quarter of 2019. In absolute terms, the total caseload declined from 762 206 persons in 2015 to 631 042 in the first quarter of 2019, a drop of 131,164 people. The most likely reason for this positive improvement is that these people have found work.
Despite this overall positive trend, Indigenous Australians represent an increasing proportion of the overall jobactive caseload (see Figure 2.9). The Indigenous caseload has been rising as non-Indigenous job seekers are leaving the caseload quicker than Indigenous job seekers. This demonstrates that jobactive providers are not achieving parity in employment outcomes. In 2015, Indigenous Australians represented 9.5% of the overall caseload whereas in the first quarter of 2019, this has increased two percentage points to 11.5%. As of the first quarter of 2019, there were 72 310 Indigenous Australians on the jobactive caseload.
Figure 2.8. Total jobactive caseload as a share of the total labour force in Australia, Q3 2015 - Q1 2019
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Source: Department of Employment, Skills, Small, and Family Business administrative data
Figure 2.9. Comparing the share of Indigenous Australians to the total jobactive caseload, Australia, Q3 2015 - Q1 2019
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Source: Department of Employment, Skills, Small, and Family Business administrative data
In terms of the overall share of the Indigenous caseload by Australian states, the Northern Territory shows the highest proportion of Indigenous Australians as a percentage of the jobactive caseload, at 56.8% in 2018. Victoria shows the lowest percentage at 3.8%, while New South Wales and Western Australia have higher proportions at 12.6% and 13.0% respectively (see Figure 2.10). In all states and territories, Indigenous Australians represent a higher share of the overall jobactive caseload than their overall share of the state population. This demonstrates that Indigenous Australians tend to be over-represented as a demographic group within jobactive.
Figure 2.10. Comparing Indigenous Australians as a percentage of the jobactive caseload by state or territory, 2018
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Source: Department of Employment, Skills, Small, and Family Business administrative data
When looking at how these trends play out in the cities of Sydney and Perth, there is a more mixed picture. In Sydney, the trend is similar to the national trajectory with Indigenous Australians increasing as an overall proportion of the jobactive caseload. As of the first quarter of 2019, Indigenous Australians represented 6.6% of the caseload. While this is below the overall national average, it represents an increase of 1.1 percentages points since 2015. In Perth, the trend has been more cyclical, likely because of the presence of mining jobs in the region that brings opportunities for “fly-in, fly-out” jobs. Indigenous Australians represent 10.3% of the overall jobactive caseload, which is an improvement since 2015.
Figure 2.11. Total jobactive caseload and share of Indigenous Australians among the total jobactive caseload, Sydney and Perth, Q3 2015 - Q1 2019
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Source: Department of Employment, Skills, Small, and Family Business administrative data
There are a number of targeted programmes that complement jobactive and aim to connect Indigenous Australians to jobs
The Australian Government introduced the Indigenous Advancement Strategy (IAS) with the objective of achieving results in the key priority areas of getting children to school, adults into work, and building safer communities. Under this strategy, many individual programmes and activities have been streamlined into five broad programmes to make it easier for organisations delivering important services in communities.
The Community Development Program (CDP) supports both Indigenous and non-Indigenous job seekers in remote Australia to build skills, address barriers and contribute to their communities through a range of flexible activities. CDP operates in over 1 000 communities across Australia, and supports approximately 30 000 people, of which around 84% are Indigenous Australians. Activities available for remote job seekers can include formal training, with the opportunity to gain a qualification, or foundational skills training such as language, literacy and numeracy training, and driver training.
Outside of the CDP, Tailored Assistance Employment Grants are available to support activities that connect working-age Indigenous Australians with real and sustainable jobs, as well as support Indigenous school student transitions from education to sustainable employment, including funding for cadetships which combine formal vocational training with practical work experience. In addition, grants can provide employers with support that assists them to employ and retain Indigenous Australian job seekers.
The Employment Parity Initiative (EPI) works with large Australian companies to become Employment Parity Partners and commit to Indigenous workforce targets. While the initiative aims to bring an additional 20 000 Indigenous job seekers into employment by 2020, another aim is to help build the internal capability of employers to recruit and retain Indigenous job seekers. As of May 2019, 15 companies have signed up to the EPI, securing a commitment of 10 700 jobs. Participating companies use their networks to encourage other large employers to follow suit and increase Indigenous employment.
The Away From Base mixed-mode programme (AFB) supports Indigenous students who are studying an approved mixed-mode course by distance education to access compulsory course elements in another location away from their permanent home for short periods of time. A 'mixed-mode' AFB course is a nationally accredited course that is delivered through a combination of distance education and face-to-face residential teaching. AFB contributes towards the costs of travel, meals and accommodation only.
The job prospects of Indigenous Australians are often impacted by their disproportionate level of incarceration. For example, incarceration rates for Indigenous Australians are now 15 times that of other Australians. Additionally, the re-offending rate for Indigenous Adult males is 77% compared to just 51% for non-indigenous males (Department of the Prime Minister and Cabinet, 2014[11]). Recognising the difficulty that Indigenous Australians face in finding work when they leave prison, the Government is implementing the Time to Work Employment Service programme, which supports Indigenous Australians in prison through access to in-prison employment services, the development of a transition plan, and a facilitated transfer to their post-release employment service provider.
Vocational Training and Employment Centres
In addition to the programmes outlined above targeting Indigenous Australians, the Australian Government has committed to support Vocational, Training & Employment Centres (VTECs) to deliver jobs for Indigenous job seekers (Department of the Prime Minister and Cabinet, 2019[12]). Currently, there are 31 VTECs that connect Indigenous job seekers with guaranteed jobs and bring together the support services necessary to prepare job seekers for long-term employment. VTEC providers work closely with employment services, Indigenous communities and industry employers to source, train and support Indigenous Australians into jobs. VTEC providers prepare the job seeker for a guaranteed job before the job starts, and then provide wrap around support for the first 26 weeks of work, at no cost to the employer. VTECs operate with the support and involvement of local Indigenous communities and their leaders. VTECs aim to be aligned to the values and needs of both Indigenous communities and employers.
VTECs receive outcome payments at staggered milestones – 4, 13 and 26 weeks in employment. VTECs are also expected to identify and source reasonable contributory funding through various sources, including jobactive organisations, state governments, employers and community organisations. jobactive providers can also claim their outcome payments as per their funding agreement. The outcome payments claimed by the VTEC and the jobactive provider are not considered duplication of funding unless the VTEC is the jobactive provider.
VTEC and jobactive organisations communicate frequently to ensure the training and other activities a participant is undertaking in VTEC are reflected in the job seeker’s Job Plan and will meet their participation mutual obligation requirements (Department of the Prime Minister and Cabinet, 2019[12]). jobactive organisations, including those which are also VTEC providers, can use the Employment Fund (as described earlier) to assist job seekers. VTECs also work with DES, CDP, and other Australian and state and territory government programmes to support Indigenous Australians into work.
Programme principles emerging from the case studies at the local level
This OECD report looks at the implementation of employment and training services in Sydney and Perth to better understand how local organisations are working with Indigenous Australians to link them to jobs. This section of the chapter highlights some key principles gathered from the case studies about the delivery of employment services.
Indigenous-led delivery can contribute to better employment outcomes
According to the feedback gathered from service providers and local stakeholders consulted for this OECD study, a key principle guiding successful programme delivery is strong capacity and leadership. In particular, several of the case studies noted that an Indigenous leadership team ensures that design and delivery of programmes are meeting the needs of Indigenous Australians in a culturally appropriate manner. Many of the providers interviewed for this study are Indigenous owned and operated. Indigenous leadership can help to build trust between service providers and Indigenous job seekers in order to define career aspirations and determine appropriate employment action plans. It can also be beneficial for service providers to have Indigenous front-line staff who work directly with job seekers to get them into work.
In Sydney, a good example is the Yarn’n Aboriginal Employment Service, which is Indigenous owned and employs a number of Indigenous staff. The Yarn’n leadership team is composed of Indigenous Australians and the majority of staff members delivering programmes are also Indigenous. For those who do not self-identify as Indigenous, staff participate in job shadowing upon arrival and receive bonus incentives as motivation to reach goals as an organisation. Yarn’n deliberately attracts consultants from diverse fields, who have not necessarily worked in employment services with the goal of attracting front-line staff who will understand some of the unique needs of Indigenous job seekers.
In Perth, Indigenous leadership was critical in setting up the Wirrpanda Foundation. David Wirrpanda set-up the organisation in 2005 with the goal of leading employment and training services targeted to Indigenous Australians. Similarly, PEEDAC is an Indigenous owned and operated, not for profit organisation that provides a range of services. PEEDAC was founded in 1997 and is a wholly owned subsidiary of Kaarta-Moorda Aboriginal Corporation (KMAC).
Wrap-around services and intensive case management strategies can address multi-faceted and complex employment barriers
The current jobactive model encourages regular monitoring and evaluation to ensure that programmes and services are efficiently targeted to those individuals who face the most disadvantage. The funding model places a strong emphasis on placing job seekers into a job with full funding granted to providers when a job seekers works for 26 weeks. Some of the case studies have measured their outcomes for longer periods and considered other indicators as measurements for success. For instance, atWork Australia looks to the number of referrals and feedback from the community. All providers interviewed for this OECD study noted that it is at the 26 week period where the employment retention rate of non-Indigenous job seekers outpaces Indigenous Australians.
According to feedback from the case studies for this OECD study, the current funding model can sometimes rush participants into jobs whether the job seeker is ready or not for employment. To mitigate this, many of the case studies have a strong focus on the initial in-take assessment to develop a full understanding of the needs of each job seeker and ensure that their barriers are addressed before entering employment. It is clear that both skills training combined with intensive employment counselling are critical to achieving meaningful employment outcomes over the long-term.
Some of the providers consulted for this OECD study noted the streaming system under jobactive can present complications when serving Indigenous Australians. As many job seekers come wanting to work, when asked about their circumstances they report that their outcomes are higher than reality because they are afraid of deterring employers. For example, several job seekers may approach a provider as Stream A applicants, which is typically for candidates who would be able to obtain work the fastest. However, they end up having a criminal record and/or other significant barriers, which would justify a more intensive Stream of services. This is sometimes related to when Centrelink misidentifies candidates’ potential streams. Further hurting the streaming process, Centrelink often asks candidates’ questions that are not culturally appropriate for Indigenous Australians.
While the 26 week outcome is important in getting people into a job, it is also critical to assess whether or not Indigenous job seekers require more support and resources to acquire basic skills before entering the job market. For example, in Perth, atWork Australia tests for literacy and numeracy and provides a programme for adult literacy. In addition, the Wirrpanda Foundation has an assessment centre to better understand candidates’ potential. Wirrpanda’s FIT 4 WORK programme also helps candidates gain a sufficient level of physical fitness necessary to perform certain jobs.
AtWork Australia is committed to creating relationships, understanding and respect with Indigenous Australians. AtWork has documented this commitment in their Innovate Reconciliation Action Plan (RAP) 2017-19 (AtWork Australia, 2019[13]). The organisation provides employment services, recognising that Indigenous Australians face vocational and non-vocational barriers to employment that are best resolved via a specialist approach. Their staff and partners have substantial experience delivering services related to mentoring, support and employment in a culturally aware context. Their team works to deliver services that account for family networks and history, engaging with the surrounding community with the goal of uncovering motivations and barriers to employment.
Over the long term, it is fundamental for providers to actively work with the job seeker and employer to anticipate what supports are needed to sustain the job once the match has taken place. This will contribute to sustainable employment, while also reducing the possibility of the jobseeker returning to the caseload. In some case, providers are delivering a number of national employment programmes, which provide them with a bundle of options under which they can cater their services to Indigenous Australians. For example, Olympus Solutions in Sydney participates in Disability Employment Services (DES), Work Ready, VTEC, jobactive and ParentsNext. This approach allows Olympus Solutions to address a variety of issues through diversified revenue streams at a large scale.
For its jobactive programmes in Sydney, Olympus Solutions approaches each client’s needs using the Energise Model (Olympus Solutions, 2019[14]). This model is based on a set process: job seekers register their employment on a work search portal and partake in an in-person interview to assess job goals, while the organisation identifies employers looking for the job-seekers skills and tries to find employment and ensure candidates hold their job. The Energise Model places a strong emphasis on job seeker follow-up after they have been placed in a job. Counsellors liaise with the placed job seekers once a week for a 12 week period to monitor how the employment placement is proceeding.
The Yarn’n Employment Service addresses individual job seekers through holistic, wrap-around services. They offer pre-placement readiness training to ensure Indigenous Australians have the right employability skills to find a job (Yarn'n Aboriginal Employment Service, 2019[15]). Yarn’n also offers post placement support, which aims to connect Indigenous Australians already working to mentors whose objective is to build perceptions of self, career and choices. Each consultant is assigned to the same job seeker from the beginning to end of their interaction with Yarn’n.
Having dedicated staff that actively work with employers to support Indigenous employment can generate new job opportunities
It is often the case that employment services providers have a “reverse marketing” function. Reverse marketer’s target specific employers with whom the jobseeker is likely to be able to find sustainable employment. This means understanding the skills, attributes and desire of the jobseeker to work in a specific industry and matching these to local employers who are most likely to need additional labour, and having a strategy to “sell” the jobseeker to these employers. It is in the best interests of both providers and jobseekers that providers target their reverse marketing activities according to the needs of their local labour market and the skills and aspirations of the individual jobseekers on their caseload.
One way to avoid the inappropriate use of reverse marketing is to separate the reverse marketer in the office from other roles. For example, according to the case studies interviewed for this OECD study, it is best if the employment consultant (e.g. the individual who has direct contact with jobseekers) does not participate in reverse marketing. Instead, it is preferable if this role is allocated to a specialist reverse marketer who is one-step removed from the jobseeker. This reduces the risk that employment consultants push unsuitable jobseekers onto employers. The separation is also justified by the particular attributes required for effective reverse marketing: a strong connection with the local industry that takes a long time to build.
In Sydney, the Yarn'n Employment Service draws on extensive experience to assist employers in building policies, programmes and practices to maximise the success of Indigenous candidates and Indigenous employment programme (Yarn'n Aboriginal Employment Service, 2019[15]). This includes cultural awareness training for employers and support as a means of achieving long-term employment outcomes for Indigenous Australians. All programmes aim to tailor to the expectations of the employer and include essential information on the impact of colonisation, poverty and social exclusion, communicating effectively Indigenous culture and values.
In Perth, the Wirrpanda Foundation works with employers to ensure their work environment is appropriate and accessible for Indigenous employees. To do so, Wirrpanda uses a tier ranking system within their employer network. The tiers indicate how much time and resources Wirrpanda should invest for each employer relationship to improve the workplace environment for Indigenous Australians.
Leveraging local partnerships and networks builds community-led employment programmes
Previous OECD research has highlighted how the contracted-out employment services model in Australia can create competition among service providers locally (OECD, 2014[16]). This work highlighted how the outcome-based framework can foster competition at the local level as service providers focus on achieving results to ensure they remain financially viable. Additionally, competition can deter stakeholders from sharing information and resources across service delivery organisations. While employment service providers previously received bonuses for joint efforts in placing a candidate, this practice has fallen out of use.
According to the interviews conducted for this OECD study, in practice, employment service providers do not have a strong incentive to collaborate since funding for joint placements may have to be split between providers. Despite this potential barrier, providers often do share information with the goal of having the greatest impact. Several providers offer different programmes and services, therefore a collaborative approach to job placements could be more successful if organisations can share complementary resources.
In Perth, the Wirrpanda Foundation draws on its local networks to offer a number of innovative employment programmes designed to connect Indigenous Australians to jobs through community leaders and organisations. These include the P242 Employment Programme as well as the Bidi Waalitj (see Box 2.4).
Box 2.4. Employment Programmes at the Wirrpanda Foundation
Bidi Waalitj
The Bidi Waalitj employment programme is an initiative between the Wirrpanda Foundation, West Coast Eagles and The Department of Employment, Skills, Small, and Family Business. The programme works with Indigenous Australians between 15-24 years of age in the Perth metro area to help place them into suitable employment.
The origin of the program’s name comes from the Noongar nation, in particular the Wadjuk language group, where Bidi means ‘path’ and Waalitj translates to ‘eagle’. The name was selected to represent the path of the eagle and signifies the valued partnership between the West Coast Eagles (a professional Australian rules football club) and Wirrpanda Foundation, as well as the journey to employment the programme’s participants experience. The West Coast Eagles play a pivotal role in the partnership, leveraging the club’s strong business networks to connect prospective employers to the programme, resulting in jobs for young Indigenous Australians.
The P242 Programme
The P242 programme is aimed at inspiring and creating opportunities for long-term unemployed Indigenous Australians aged 18+ to reach their full potential and gain employment. The Wirrpanda Foundation's weekly FIT 4 WORK programme for Indigenous job seekers runs every Thursday in East Vic Park. Their activities aim to improve physical fitness, self-confidence, employability and networking opportunities.
Consistent attendance in this programme is expected to improve the opportunities to find full time employment. The Foundation’s mentors deliver the weekly programme and provide mentoring support for participants whilst also improving the health and wellbeing of attendees. Following a physical activity session, job seekers also participate in industry-specific training and work readiness aimed at better preparing them for employment.
Source: (Wirrpanda Foundation, 2019[17])
What can Australia learn from other OECD countries?
Customising employment services to Indigenous needs
Some OECD countries are adapting their active labour market policies and programmes to ensure that services are targeted to meet the specific needs of Indigenous people (OECD, 2018[4]). In general, OECD research has highlighted the importance of moving away from a job-first focus to ensure services can be catered to basic and foundational skills training that addresses the challenges that often prevent Indigenous people from maintaining a job.
To address Indigenous unemployment, OECD countries either use employment services available to the general public or a specified offering of services or programmes targeted to the needs of Indigenous clientele (OECD, 2018[4]). Some programmes also include pre-employment and employment retention services to enhance offerings to beneficiaries.
In Sweden, the Swedish Public Employment Service (Arbetsförmedlingen) is responsible for managing employment services for all citizens, both Sami and non-Indigenous people. The Arbetsförmedlingen is divided into four market areas,further categorised into 68 labour market regions. Arbetsförmedlingen provides services at this geographical level (Government Offices of Sweden, n.d.[18]).
Arbetsförmedlingen offers services to prepare and connect job seekers to employment, provide unemployment benefits, evaluate a jobseeker’s skills and compatibility to particular sectors and resources to start a business (Swedish Public Employment Service, 2019[19]). Arbetsförmedlingen’s employment services provide opportunities for unemployed 20-25 year olds to participate in traineeships part-time while enrolled in vocational training. The employment services also offer jobseekers the option to receive more support in the workplace through provision of a supervisor. The supervisor is paid by the Public Employment Services for their role managing the jobseeker during the trial work experience.
Employment services for Indigenous and non-Indigenous Norwegians are delivered through the Norwegian Labour and Welfare Administration (NAV). NAV employs 19 000 people in 456 offices located in different municipalities and cities districts. NAV and local authorities together decide what will be offered in each location. As such, services are geographically customised to the needs of each local community (Norwegian Labour and Welfare Administration, n.d.[20]).
NAV provides benefits similar to Sweden, such as unemployment and wage subsidies for those who need adaptations to their work environment. For employment services, NAV also provides a Qualification Programme that helps jobseekers develop skills. The Qualification Programme is designed for fulltime vocational work to jobseekers of all ages. The programme includes “work-oriented activities, training activities, and close individual follow-up and guidance” components (Norwegian Labour and Welfare Administration, n.d.[20]). NAV also has programmes to assist with job retention, such as work mentorship, and additional support from on-site supervisors (Norwegian Labour and Welfare Administration, n.d.[20]).
In Canada, the majority of active labour market programming for Indigenous people is delivered through the Indigenous Skills and Employment Training Strategy (ISETS). This Strategy, formerly known as ASETS, supports a network of 85 Indigenous service delivery providers across 600 points of service (OECD, 2018[21]). In general, the federal government in Canada has moved to an employment services management system that places a stronger emphasis on high quality jobs and providing Indigenous service delivery organisation with more autonomy in how they delivery their programmes locally. For example, whereas service delivery agreements were five years under the ASETS programme, Canada is now moving to ten-year accountability agreements under ISETS.
Among the service delivery organisations in Canada, the Winnipeg-based Centre for Aboriginal Human Resource Development (CAHRD) provides a good example of a local organisation providing comprehensive services to Indigenous job seekers. Based in Winnipeg, Manitoba, CAHRD’s services focus on, and are co-ordinated to meet, the needs of Indigenous people as they adapt to the challenges of a modern urban setting. According to CAHRD, 2 000 people annually receive employment services, with 800 placed in successful employment and 400 receiving education and training (Centre for Aboriginal Human Resources Development, 2019[22]).
CAHRD has three employment departments, which work under one location in a one-stop-shop delivery framework: Central Employment Services, Staffing Solutions and Aboriginal People with Disabilities Program (Centre for Aboriginal Human Resources Development, 2019[22]). The Central Employment Services help Indigenous people in developing an action plan to successfully attain career goals, by offering one-on-one counselling services, referrals to academic upgrading or post-secondary training, free step-by-step support, including career exploration, training options, job search strategies, workshops and access to an ICT resource centre. Employment counsellors offer career exploration options, referrals to employment, education and training, and job search strategies.
Using digital technology to deliver employment services to Indigenous Peoples
With the increasing diffusion of technology, many employment services across the OECD have started to look for opportunities to embrace digital technology in the overall delivery of labour market programmes. Public employment services, such as the VDAB (Flanders, Belgium) or Korea’s Employment Information Services have recently introduced Artificial Intelligence support for competence-based matching.
Under these systems, digital technology is being used to look at how to automatically match job seekers with the best available job or task based on their actual skills of job seekers, independent from their official and certified qualifications. The challenge for Indigenous employment services delivery is that Indigenous people often lack digital literacy skills that can help them fully embrace the use of such technology for more efficient job matching.
There are examples in which Australia can look for policy inspiration specifically using digital technology to offer services for Indigenous job seekers. For example, in the United States, Nativehire provides an array of employment resources available online. Native Americans have the ability to connect to employers and apply to jobs though online posts. The website also has a variety of videos that provide advice to job applicants on how to participate in job fairs, write a cover letter, dress professionally, use social media, network, work as an intern, create a resume, interview, negotiate salary and more. The advice videos come from the perspective of a former recruiting officer and his experiences with hiring new employees (Nativehire, n.d.[23]).
Supporting youth transitions into the labour market
With the projected changes in the world of work, OECD research has shown that youth in particular will face major challenges in terms of jobs that are more likely to be vulnerable to automation (OECD, 2019[3]). This is why it is important to focus programme and policy development on better linking youth to a first job and work experience. The longer younger people are out of the labour force, the higher the risk that they will fall into long-term unemployment or inactivity. Long periods of unemployment for youth have been shown to have potential “scarring” effects, which have a harmful impact in later life, particularly for NEET youth. It can lower future income levels, skills validity, future employability, job satisfaction, happiness and health levels (OECD, 2013[24]).
Ensuring employment success for young Indigenous people is a policy issue of particular relevance locally. Barriers preventing young Indigenous people from successful transition into employment are often multifaceted in nature and responses need to come from a wide array of policy areas. It is at the local level that government policies can be integrated and combined with place-based initiatives to provide multidimensional responses to complex problems (OECD, 2013[24]).
For example, The Ministry for Pacific Peoples in New Zealand has established the Pacific Employment Support Service (PESS) programme to help young Pacific Islander Peoples find employment and complete further training or study (Ministry for Pacific Peoples, n.d.[25]). Funded by the Ministry, the programme aims to reduce the number of young Pacific Islanders aged 15-39 who are Not in Employment, Education or Training (NEET), and prepare them for work. PESS co-operates with families and local communities and places jobseekers into sustained employment. Increasing Pacific income and building Pacific leadership are priority focus areas for the Ministry.
The programme helps youth in Auckland, Hamilton, Waikato, Manawatu-Whanganui, Otago, Bay of Plenty, Hawke's Bay and Murihuku/Southland to find sustainable employment, education or training opportunities by working with local providers. These providers motivate, train and match young people to jobs or education that best fit them. Examples of services they offer include tailoring interventions such as career advice, CV design, coaching or interview skills.
From 2010 to 2018, the programme has achieved the following results: 2 246 young Pacific Islanders have participated in the programme, 1 072 have been successfully placed into employment, 231 have achieved continuous employment over 12 months, almost 700 have found training placements and over 140 people have completed training qualifications. The Ministry plans to continue the implementation of this programme and expects to place 1 000 Pacific NEET people in employment or training between 2019 and 2020.
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