The Government subsidy that pays employers to sack older workers

Article published 3 March 2021

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OLDER workers bring with them years of experience and fine-tuned skills but are often overlooked because of their age. The JobMaker hiring credit, a federal government initiative announced in the November federal Budget, may impose additional barriers for older workers.

Federal Treasury documents obtained under Freedom of Information by the ABC show an employer could sack a full-time employee earning $75,000 and replace them with three part-time employees earning no more than $30,000 each at no additional cost to the employer.

The JobMaker scheme pays employers $200 a week ($10,400 a year) to hire unemployed Australians aged 16 to 29 and $100 a week ($5,200 a year) to hire unemployed 30 to 35-year-olds. The subsidies pay for the additional costs spent on wages for the three new employees, if an employer can show an increase in money spent on wages as well as an increase in staff numbers.

The aim of the JobMaker scheme is to get young people back into work. This is commendable, considering Australians younger than 35 have suffered the most job losses, due to the COVID-19 pandemic, of any age cohort. JobSeeker payment recipients aged under 35 rose from 230,000 in March 2020 to over 500,000 in September 2020.

But why should older workers pay the price?

Before COVID-19 almost a third of people over-55 remained on JobSeeker for five years or more. A Parliamentary Budget Office report published on 30 September suggested that older Australians will continue to remain on JobSeeker longer than any other age group after the pandemic has passed.

Currently, one in five Australians between 55 and 64 is jobless.

That’s 20 per cent.

How much worse must things get before something is done to help older Australians looking for work?

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