The May Federal Budget will need to crank up funding in the healthcare, education and childcare sectors if the Treasurer is to make good on his goal of bringing down the unemployment rate, experts have said.
Treasurer Josh Frydenberg said bringing the jobless rate, currently 5.6 per cent, down to “hav[ing] a four in front of it” was a central goal for his second ‘pandemic budget’.
“The Budget will lay out the next phase of Australia’s economic recovery plan, to grow our economy so we can deliver the jobs and guarantee the essential services Australians rely on, and keep Australians safe,” he declared last week.
But where exactly should these jobs be created in order to rev up the economy? Here’s what the experts told Yahoo Finance.
If the 2021 Budget is to focus on jobs, there should be a strong focus on the care economy, according to thinktank Grattan Institute CEO Danielle Wood.
“Care sectors are labour intensive and so deliver great jobs bang for buck in terms of government spending,” she told Yahoo Finance.
Healthcare jobs, alongside education, have also been singled out by the National Skills Commission as the two sectors expected to add the most jobs over the next five years.
“We also know that there is a big social need for expanding services in areas like aged care and mental health,” Wood added.
Recruitment firm Adecco Australia managing director Kelly Van Nelson also said the 2021 Budget needed to contain further investment in healthcare.
“As the nation finds its way out of COVID-19, we cannot forget the lessons learned during the pandemic. It revealed how critical our front-line health workers and health services are and they must be properly resourced and supported.”
Australia needs a national overhaul of the TAFE system, and federal funding should be directed towards apprenticeships, said Alison Pennington, senior economist at the Australia Institute’s Centre for Future Work.
“The government has indicated it will pursue more so-called ‘market-led reforms’ of the vocational education and training (VET) sector. This would be disastrous,” Pennington told Yahoo Finance.
“Australia’s VET system is in terrible shape after decades of neglect and market experimentation.
“We need to reinvent and recapitalise an integrated post-secondary education system (including a revitalised public TAFE system) that can more effectively meet the needs of new industries for skilled workers and professionals.”
More than 200,000 apprenticeships in the pipeline have been lost between 2012 and 2017, she said, and as many as 130,000 more could be lost leading up to 2023.
“TAFE delivers over half of apprenticeship programs in Australia, yet have not appeared once in the Coalition's jobs and skills policies,” she said.
The Government has aimed at growing “short, low-quality traineeships” but not apprenticeships, which need long-term investment and commitment. But this will require strong public funding.
“This Budget, the government cannot use skills development to pass the buck on job creation. Skills don't create jobs,” she said.
Australia is experiencing a glut of overskilled workers and not enough jobs, with employment rates for university graduates at record lows, Pennington added.
“The Morrison government must prioritise sustained, long-term investment (both public and private) in creating good, skilled jobs of the future. This means no longer gifting businesses billions in public money without conditions of creating jobs, more direct hiring in public sector jobs, and investing in our public VET and universities to deliver the skills we need.”
Business Council boss Jennifer Westacott also believes more needs to be done to improve women’s participation in the workforce.
Adecco Group ANZ regional managing director Preeti Bajaj said 6.5 million more digital workers would be needed in Australia over the next five years.
But targeted funding education will have to factor into this, she added.
“If we don’t use this time to change the education system in a diverse and equitable fashion, we fall behind and miss out on billions in economic growth.”
“Historically we have considered education as an expense, but we need to move the conversation to agility and micro-credentialing to create jobs that will support the economy of the future.”