• Federal Budget 2020-2021

JobMaker Hiring Credit

In an effort to promote employment growth, the Government has committed $4 billion over the next three years in the form of JobMaker Hiring Credits to eligible employees aged 16-35 years. The program is designed to encourage employers to hire young workers and move people from JobSeeker, Youth Allowance or Parenting Payment programs into stable employment.

Up to $200 per week credit for young Australians

The subsidy will be split into two, age-based tiers and will be available to employers excluding the major banks and those businesses that are currently claiming JobKeeper. Eligible employers will receive a credit of $200 for certain employees aged 16-29 that increase the total headcount and payroll of the business and $100 for those aged 30-35.

The payments will be available for the first 12 months of a worker’s employment and will be capped at $10,400 for each additional position created. Whilst new jobs created from 7 October 2020 will be eligible for the program, employers will be required to make claims in arrears beginning 1 February 2021.

In order for an employee to be eligible for either of the tiers of payment, they will be required to have worked, on average, at least 20 hours per week each quarter. Further to this, they must also have received the JobSeeker Payment, Youth Allowance or Parenting Payment in at least one of the three months prior to their new employment.

The plan is expected to cost $850 million in the 2020-21 period and totalling $4 billion over the next three financial years. Over its life, the JobMaker credits are expected to support up to 450,000 jobs for young Australians nationwide.

BDO Comment

BDO supports this Government initiative in promoting job opportunities for young Australians. Young people are one of the most at risk demographics in times of economic downturn with almost 700,000 young people on either the JobSeeker or Youth Allowance programs as of August. Both the economic and social benefits of this program in parallel with other initiatives announced, present much needed support and hope for some of those worst affected by the recession.