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Job Network loses jobs -

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Job Network loses jobs

The World Today - Monday, 8 December , 2008 12:27:00

Reporter: Donna Field

ELEANOR HALL: While unemployment is already rising, the companies that are meant to find work for
unemployed Australians are themselves shedding staff.

Two of the biggest providers of job placement services in Australia say they are laying off workers
because of the global financial crisis.

Mission Australia and the Salvation Army are cutting 200 jobs, as Donna Field reports.

DONNA FIELD: The Salvation Army is the largest job network provider in Australia. It's retrenching
between 100 and 120 staff.

Mission Australia the third largest provider has announced it's following suit.

Executive leader of employment services, Leisa Hart.

LEISA HART: Mission Australia will be making a number of positions in its employment services
redundant as of mid-January. We anticipate this decision will impact on 73 full-time positions; the
majority in New South Wales and the remainder in Queensland and Western Australia.

Many of these roles, about 30 of them, are currently unfilled. We expect around 40 people will be
affected.

DONNA FIELD: Now why have you had to make this decision?

LEISA HART: Vacancies in the Australian job market have declined steeply over the past four months,
particularly in New South Wales.

Mission Australia's placements into jobs were down 25 per cent year on year for October and 31 per
cent for November. Generally job network providers receive the bulk of their payment as they place
people into work.

If the vacancies aren't there, then that impacts on income. And as a community services charity,
any shortfall in income means that Mission Australia service delivery in other areas, including
some of our community's most disadvantaged members, can be affected.

DONNA FIELD: While the not-for-profit sectors are scaling back their services, the second biggest
provider in the job network Job Find isn't retrenching any staff.

The private company says more and more unemployed people are seeking its help and recruitment is
seasonally strong, with thousands of people being employed in the retail and hospitality services.

All of the job network providers have just lodged tenders for new government contracts. Those
contracts will be announced early next year.

But Opposition spokesman for employment participation, Andrew Southcott, says the employment
network needs to be overhauled to cope with the changing economic conditions.

ANDREW SOUTHCOTT: This is a major concern. Salvation Army and Mission Australia are two of the
larger employment service providers in Australia. And the problem will only get worse on 1st of
July when Labor's new employment services begins. Because what they have done is design an
employment services system with a low unemployment environment in mind.

In fact, the Minister for Employment Participation, Brendan O'Connor, specifically said in May 2008
that the job network was no longer suited to a low unemployment environment.

DONNA FIELD: Isn't this just a reflection of the global economic environment though, that people
just aren't recruiting.

ANDREW SOUTHCOTT: Certainly there is an expectation that we will see unemployment rise and it will
be much harder to place people in a job. But Labor's employment services model does not take this
into account.

They've made the assumption that the vast majority of job seekers will be able to find work
themselves and as a consequence there are very little payments or incentives for the 61 per cent of
job seekers that will be considered job ready.

Very few payments or incentives to employment service providers and what the Opposition has been
saying is that this model will not work in an environment of rising unemployment and in a weaker
labour market. It simply will not work and they need to review it.

DONNA FIELD: The Minister for Employment Participation, Brendan O'Connor, says that any job losses
in any industry are regrettable.

He says the Government is taking swift and decisive action, including the release of its
$10-billion Economic Security Package.

ELEANOR HALL: Donna Field reporting.