The Productivity Commission has put a question mark over an Audit Commission recommendation that young unemployed people should be forced to move in order to keep their benefits, with a report finding that there are "no simple levers" on the issue.
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A Productivity Commission report, released on Tuesday, on geographic labour mobility, finds that many government policies aiming to directly influence where people live and work have had "limited effectiveness".
It says that "[policy] benefits are likely to be higher if governments focus on creating an economic climate conducive to growth across all regions and industries".
It adds that improving employment prospects for the long-term unemployed people require a "suite of responses", including changes to employment services and improving housing affordability.
The report flies in the face of an Audit Commission recommendation that long-term unemployed people should "improve their job prospects" by moving to high-employment areas. The Commission would like to see young single people between 22 and 30 relocate after 12 months or lose their benefits.
There have been suggestions the government will not go ahead with the recommendation.
Welfare advocates, such as the National Welfare Rights Network, have already criticised the forced relocations, arguing that wage subsidies and increased training opportunities are a "better way forward".
The Productivity Commission report, commissioned by former Labor assistant treasurer David Bradbury in May 2013, finds that high unemployment is "persisting" in some regions and there is "room for improvement".
It also notes that there is a "clear correlation" between moving labour markets and leaving Newstart. But it cautions that this does not mean that moving causes people to leave Newstart, as the analysis does not control for differences in the underlying characteristics between movers and non-movers.
The report paints a complex picture for long-term unemployed people who are looking for work and there are "significant risks" associated with moving for work for the group.
Frequent moves for low-skill, casual jobs has been identified as a common path to homelessness, while "speculative moves" to metropolitan areas or other areas where living costs are high can increase the risk of poverty. Moving for work may be more difficult for long-term unemployed people and other disadvantaged groups because they have a greater reliance on family for supports such as childcare.
The Productivity Commission report also comes amid reports that the Coalition government is preparing to introduce sweeping changes to unemployment benefits in next week's federal budget. This includes increasing the age at which people can access Newstart from 22 to 25.
As part of its election commitments, the government has already pledged to provide long-term unemployed jobseekers with $6000 if they move to a regional area to take up a job and $3000 if they move to a metropolitan area.
