Govt to trial $60m wage subsidy

The federal government today launched a new wage subsidy trial targeting apprenticeships in rural and regional areas, which will invest $60 million across a range of trades.

Under the initiative, eligible employers will be able to receive payments based on an apprentice’s relevant award wage rates.

Funding will be provided at 75 per cent of the apprentice’s award wage in the first year, followed with 50 per cent in the second year and 25 per cent in the third year.

Skills and Vocational Education Minister Michaelia Cash said up to 1,630 new apprenticeships would be offered in areas of need.

“There are 3.3 million Australian small businesses which contribute around $395 billion annually to our economy,” she said.

“Small business plays a vital role in our community, from giving young Australians their first real job to supporting our local charities and sporting organisations.

“Through this incentive we are securing the skills our regional and rural businesses need to remain competitive and give local students new opportunities at home.”

Ms Cash said the subsidy would begin on January 1 next year and would support apprenticeships in areas such as plumbing, mechanical, electrical, painting trades and hairdressing.

Australian Industry Group chief executive Innes Willox welcomed the announcement.

"Support is urgently needed by employers who are facing high levels of skills demand particularly for trades and technician workers, as they experience rapid change due in large part to digital transformation,” he said.

“This initiative will assist them to meet current and emerging occupational needs.

"The incentives will also have the benefit of helping reduce youth unemployment and underemployment, a problem more prevalent in rural and regional Australia.

"The trial will be important in ascertaining whether this wage subsidy approach is affordable and sustainable across the country.”