Annabel Brown | Employment issues in spotlight following white paper release

We are yet to deliver the benefits of national prosperity to the people who need it most.

To realise our country's untapped potential we must connect people and work using the power of local knowledge on a national scale.

The report is the third in a series of big-picture pieces by Treasury, following the Intergenerational Report and the Measuring What Matters framework.

They come against the backdrop of a pandemic that for many of us starkly illustrated the importance of building an economy that provides security, safety and equity.

A major factor in our wellbeing, it notes, is the presence or absence of decent work, and the security, pay and conditions it brings.

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It sets out a long-term vision for sustainable, inclusive full employment in Australia, identifies changes in the economy that will affect our path, and proposes a 10-step roadmap to navigate them.

The wide-ranging report - covering digital transformation, climate impacts, government services, skills training and more - confronts some uncomfortable truths and does not shy from telling them.

It goes beyond headline figures - today's record-low unemployment rates and our three-decade run of increasing GDP - to explore the more complex, less glamorous reality.

Nearly 3 million people either want work and can't get it, or have work and want more.

About one in six of these people were represented in August's 3.7 percent unemployment rate.

Another million are under-employed, and 1.3 million want work but cannot seek it, so are not included in the labour force.

These people don't have the finances, housing, transport, childcare to seek work today, or are unable to because of training, care responsibilities or life circumstances.

They are concentrated in a relatively small number of regions, towns and suburbs, where the compounded failings of our current approach to providing employment and social services are glaringly apparent.

To fix the flaws the white paper exposes and navigate the challenges it predicts, we must make overdue and substantial improvements to the way government connects with people, communities, employers and industry.

The ongoing inquiry into Workforce Australia, conducted in the shadow of the robodebt scandal, has heard how our current approach has failed. Services are currently only available to people classed unemployed who receive income support.

The system is not working for them. The white paper provides more than 2 million more reasons for reform.

A decades-old, fully outsourced employment system is fixated on shifting risk to providers and enforcing compliance among citizens. The system is connected to less than 4 percent of employers.

For those who have to interact with it only for short periods of time it's a significant but temporary inconvenience. For those who enter the system and are trapped in it sometimes for years, it is a maddening bureaucratic island they are marooned on, disconnected from local services and employers who could help them escape it.

In 2018, an expert advisory panel commissioned by the government said that a system that cost more than $1 billion a year had to do much better. Five years later we have seen no substantial reform.

It's to the government's credit that the Paper recognises this failure and identifies place-based approaches as the direction for reform.

There are more than 130 different place based initiatives currently running in Australia across different services and at different scales.

They harness the power of local knowledge and community connection. Government, community leaders, service providers, employers collectively determine what success looks like in their own communities.

There is a strong evidence base for this - initiatives are serially successful in pilots and trials.

Until now they have been prevented from scaling to a national level by a bureaucratic preference for national uniformity over local relevance.

The white paper reveals an opportunity to reform our national employment system through regional gateways.

These would map local labour markets to identify skills needs, areas of structural underutilisation to fill labour shortages, and local services to overcome barriers to employment.

It would rebalance our employment system so that it handled the supply and demand sides of local labour markets to produce tighter feedback loops between what employers need and the skills and support delivered to job seekers.

This would increase productivity by filling labour shortages more efficiently, and address disadvantage by ensuring that major employers in areas like Logan, Hobart, North Adelaide and western Melbourne could hire locally.

Embracing this approach demands that we move beyond system tweaks and temporary targeted programs.

We need a major overhaul with people and communities at the centre of policy and service design.

The white paper's ambition shows us where we need to go. Its candour shows that we cannot get there by doing what we've previously done.

A truly national people and place centred engine for skills, training, employment and community building can make sustainable, inclusive employment a reality for all Australians in the decades to come.