Josh Frydenberg has announced a suite of changes that will significantly impact employers
Treasurer Josh Frydenberg has announced a suite of new measures in the 2020 budget that will significantly impact employers.
These include new measures relating to training and apprentices, subsidies for youth employment, mental health and female workforce participation.
Frydenberg announced to Parliament that Australia’s circumstances have changed dramatically since the COVID-19 pandemic, but Australians have not.
“We have a plan to rebuild our economy and to create jobs. Our jobmaker hiring credit will support nearly half a million young Australians in work,” he said.
“Our record investment in skills and training will strengthen Australia’s workforce.”
Summary of changes for employers
JobMaker hiring credit
The Coalition has announced it will pay organisations to hire young Australians as part of a $4bn budget measure that aims to address rising figures of youth unemployment.
The subsidy, branded "JobMaker", means that employers will receive a credit for each new job they create if they hire someone between 16 and 35 years old.
The credit will be $200 per week for 16-to-29-year-olds, and $100 for 30-to-35-year-olds. It will be available until this time next year.
Apart from the major banks, all businesses will be eligible for the new scheme.
To qualify, the new employee must have received the jobseeker payment, youth allowance or parenting payment for at least one month out of the three months prior to being hired.
Frydenberg said that Treasury estimates the initiative will support around 450,000 jobs for young people.
“Having a job means more than earning an income. It means economic security. It means independence. It means opportunity,” said Frydenberg.
“We can’t let this COVID recession take that away.”
Read more: Top priorities for HR revealed
Training and apprenticeships
Training subsidies have expanded with the government pledging to cover half the wages of 100,000 new apprenticeships and traineeships.
The plan is covered by a 50% government wage and subsidy and will cost the government $1.2 billion over four years. Organisations will be reimbursed up to half the cost of an apprentice or a trainee’s wages up to $7,000 a quarter. However, the scheme is capped at 100,000 places.
This subsidy will be available to businesses of any size between October 5 2020 and 30 September 2021.
“The wage subsidy will support school leavers and workers displaced by the Covid-19 related downturn to secure sustainable employment,” according to the budget papers.
The two initiatives are part of the government’s move to replace the Jobkeeper wage subsidy and jobseeker payments.
The Business Council of Australia’s Jennifer Westacott welcomed the government’s decision to support workers.
“This budget continues the important process of rebuilding the skills system with 100,000 extra apprentices and an additional 50,000 short courses which will help people retrain and reskill faster,” said Westacott.
“We also welcome the government’s commitment to wage subsidies, particularly targeting young Australians who are at the highest risk of unemployment and helping them into the workforce.”
Mental health
Many employees in Australia have reported the major toll COVID-19 has taken on their mental health, and the Government has announced the extension of a few key services.
Namely, the number of Medicare-funded psychological services will be doubled from 10 to 20.
It follows the announcement of subsidised telehealth services, including for mental health services, which would be extended until the end of March next year.
The Government also suggested that there would be more announcements to come once it releases the Productivity Commission's reports on mental health.
Female workforce participation
Australian women made up the majority of those who lost their jobs during this crisis, according to Frydenberg.
He said the budget includes the government’s second women’s economic security statement, with $240m in measures and programs to support:
• New cadetships and apprenticeships for women in science, technology, engineering and mathematics
• Job creation and entrepreneurialism, and
• Women’s safety at work and at home.
“The 2020 women’s economic security statement will create more opportunities and choices for women, not just for the recovery but for generations ahead,” said Frydenberg.
“As the health restrictions have eased, these jobs have started to come back, with 60% of the 458,000 jobs created since May filled by women.
“But challenges remain. We are determined to see female workforce participation reach its pre-Covid-19 record high.”
Tax breaks
Businesses are also set to receive $31.6 billion in tax breaks. However, Frydenberg said the business tax cuts are not permanent.
They temporarily allow businesses suffering losses to claim back recent taxes paid and encourage them to bring forward investment through immediate and full tax deductions. The measures will be available for companies with a turnover up to $5 billion.
It follows the $31.9 billion that the government has already paid out via its tax-free cash flow payments to small and medium businesses and not-for-profits.
The aim of the tax cuts is to create an extra 50,000 jobs, stimulate $200 billion in business investment in new machinery and equipment, and boost the economy by $12.5 billion over the next two years.
