The Unemployment Problem.

And the Government's non-solution.

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Let’s start with a couple facts.

1. The Unemployment rate is now 4.8% (up 0.2%in the last 3 months). That equates to 148,000 people out of work (roughly equivalent to the entire population of Hamilton).

2. Online job advertisements have fallen by 31.4% over the year ( September 23 to September 24)

So we have more people out of work and fewer jobs available, and if this trend continues the recession will deepen and life is going to very tough for a lot of us.

Yesterday the Coalition announced their solution.

Individual case management to get people off the Jobseeker benefit.

Social Development Minister Louise Upston told the assembled media that up to 70,000 unemployed people will receive individual assessments and a personalised job plan from case managers who will “look at possible barriers to their employment such as education, transport, addiction, health, and childcare issues they may have.”

OK. Here’s a few questions I didn’t hear the media ask.

What qualifications will a case manager have to have?

What salary will a case manager earn?

How many case managers will be needed? ( ie what will be their workload?)

Where will the interviews happen? In person or over the phone or internet?

Having identified possible barriers to employment, what will the case manager actually do apart from come up with a work plan?

How long will each assessment session take?

What powers do the case managers have ? Can they , for example insist that someone takes a job in another area of the country? If that person refuses do the plan do they then get their benefit cut?

How much will this personalised assessment scheme cost?

Those are what I would call essential micro questions which I haven’t as yet seen asked or answered.

The bigger question is why is the government going to spend, an as yet undisclosed about of money, paying case managers to counsel people on how to apply for jobs when the reality is that there are fewer and fewer jobs available as the months go by?

The answer, of course, is the government is blinded to other possible solutions by the mask of its own ideology – ie. that governments should not get involved in the marketplace.

So instead of, say, promoting job creation schemes that would incentivise employers to take on employees, ( eg. increasing Te Whatu Ora ‘s budget so all 1619 graduating nurses can be employed and not just 844 of them ) the government are choosing to lay the blame for our crashing economy on the victims of it – the unemployed, who simply need to be coached on how to fight for a job in a diminishing labour market.

Back in February Prime Minister Luxon revealed his low opinion of beneficiaries when he used his State of the Nation speech to tell them the “free ride” was over. Since then MSD statistics reveal an increase of 21.5 per cent in sanctions imposed on Jobseeker beneficiaries since September 2023.

So, that’s the plan. Crack down on the unemployed. Crack down on the rise in crime that results when people are desperate. Build more prisons rather than build more businesses.

Does this sound like a good economic management plan to you ?

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Stats sources:

https://www.stats.govt.nz/information-releases/employment-indicators-september-2024/

https://www.mbie.govt.nz/business-and-employment/employment-and-skills/labour-market-reports-data-and-analysis/jobs-online