Budget 2010: Employment subsidy scheme extended for one year

Six thousand young people are already employed under the scheme and another 6000 will benefit. Photo / Christine Cornege

A $5000 subsidy to employ someone aged under 25 for six months will be extended for a further year in a bid to combat still-rising youth unemployment.

The Budget has allocated $16.7 million to subsidise jobs for a further 6000 young people up to the end of next year, on top of the 6000 already employed under the scheme up to June this year.

The scheme has made a small but significant dent in youth unemployment.

The number of young people aged 15 to 24 who are not in education, training, employment or caregiving leaped from 43,900 to 71,500 during last year and rose again to 73,800 in the first quarter of this year, despite a fall in overall unemployment.

The $5000 subsidy pays about one-third of the cost of employing a young person for six months at the minimum wage.

However, other employment schemes, launched after last year's recession, will be allowed to lapse as the economy begins to pick up.

ReStart, which pays higher family support and accommodation supplements to redundant workers for up to 16 weeks, will end on schedule at the end of this year.

So will the Job Support Scheme, which subsidised employers to keep workers on reduced hours rather than make them redundant.

The scheme will have saved 1500 to 2000 jobs by the end of next month and is budgeted to save only a further 100 to 200 jobs before it ends in December.

The Community Max scheme, which paid community groups a full subsidy to employ a young person for six months, was closed in February when its budget ran out.