Revisiting the job guarantee: ten propositions towards a model for New Zealand

Abstract This policy commentary complements the research report on Transition Assistance for Young People, released by the New Zealand Mayors' Taskforce for Jobs. It provides a snapshot at the international evidence concerned with job guarantee and welfare-to-work initiatives. Against this background, ten policy propositions are presented to inform the design of a Guarantee-style programme that meets the needs of New Zealand's dispersed and spatially unbalanced labour market. Introduction In June 2006, the New Zealand Mayors' Taskforce for Jobs released a research report on Transition Assistance for Young People (Higgins et al. 2006). In the Taskforce's 2007 Annual Report, Mayors and local government officials expressed their commitment to using the information [of the report] to inform future policy and activities particularly around youth transitions and keeping young people engaged in our communities (Mayors' Taskforce for Jobs 2007:9). This commentary revisits one of the report's primary objectives: to examine the possibility of introducing a guarantee for all people under the age of 25 to be in paid work, training, education or in useful activities in our communities. A snapshot at the international evidence of related job guarantee initiatives is being provided with the intention to inform the ongoing deliberations of relevant policy makers. Whilst Mitchell, Cowling and Watts (2003) already draw on experiences in Norway (Hummeluhr 1997) and the Netherlands (van Berkel 1999; Brodsky 2000), this paper, without attempting to be exhaustive, complements their arguments by reference to selected experiences in North America and the United Kingdom. On this basis, ten propositions are offered to provide a platform for further debate, challenging the conventional wisdom and promoting the design of a Guarantee-style programme that is best tailored to New Zealand's labour market conditions. Job Guarantee: Old Wine in New Bottles? In much of the OECD, concern about the changing composition as well as the numbers of young and long term benefit recipients has been growing. Whereas most claimants some thirty years ago were considered unavailable for work due to disability and illness, for example, the majority of working age claimants is now available for work but not employed. The weight attached to different explanations has changed over time (including labour taxation, employment protection, trade union activity, and systems of unemployment support; see e.g. Kluve and Schmidt 2002) and in recent years politicians and policy makers have attributed growing importance to the problems faced by particular claimant groups - most prominently the long-term unemployed and the young. As both, the scale and duration of unemployment spells for these target groups reached unprecedented and persistently high levels in a number of countries, the focus on welfare-to-work and job guarantee initiatives sharpened. At the outset, it is unremarkable to state that such programmes are not new. A wide range of local, regional and national policy instruments has been employed to reduce the barriers into paid employment, and various forms of training and work creation schemes have been developed, often through a combination of voluntary incentives and mandatory requirements (for example, the UK's New Deal programme; Ontario Works; British Columbia Benefits; British Columbia Youth Work, the Alloa Initiative in Scotland as well as a range of other local pilot programmes). At the same time, more demand-responsive initiatives, which include employers within local partnerships providing job or interview guarantees for programme participants, were developed as a means of delivering training and employment that is relevant to the needs of the labour market and provides security and long-term benefits for job seekers (e.g. Hoogvelt and France 2000; Adams et al. 2001). As a consequence and throughout OECD member states, a consensus emerged asserting that economic recovery will not on its own resolve the societal ills of youth and long-term unemployment and respective welfare dependency. …

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