Employer Guide to Hiring the Long-Term Unemployed: Benefits, Incentives, and Best Practices
Why Hire Long-Term Unemployed People?
The Business Case
- Untapped talent pool: With labour shortages across sectors, the long-term unemployed represent a significant source of available workers
- Motivation and commitment: Many people who have struggled to find work bring strong motivation to a new role when they are well supported
- Government incentives: Financial and practical support is available in many countries (see below)
- Diversity of perspective: People who have experienced hardship bring resilience and empathy
- Social impact: Reducing long-term unemployment benefits the broader economy and community
Addressing Employer Concerns
- "Skills will be outdated": Offer refresher training — it is often cheaper than competing for a fully qualified candidate
- "They'll be unreliable": Proper onboarding support, clear expectations and regular check-ins address most early reliability concerns
- "Something must be wrong with them": Long-term unemployment is often caused by structural factors (disability, caring responsibilities, economic conditions), not personal failings
Government Incentives
| Country | Programme | What It Provides |
|---|---|---|
| US | WOTC (Long-Term Unemployment Recipients) | Tax credit of 40% of up to $6,000 in qualified wages (maximum $2,400) for hiring someone unemployed for at least 27 consecutive weeks. Note: authority to claim the credit lapsed for wages paid after December 31, 2025 — check whether Congress has reauthorised it |
| UK | Restart Scheme | Personalised employment support for up to 12 months for people referred by Jobcentre Plus work coaches; final referrals are expected in June 2026 |
| UK | Sector-Based Work Academy Programme (SWAP) | Pre-employment training matched to your sector, a work experience placement, and a guaranteed job interview (or help with your recruitment process) |
| Germany | Eingliederungszuschuss (SGB III) | Wage subsidy generally up to 50% for up to 12 months; up to 70% for up to 24 months for people with disabilities |
| Germany | Teilhabe am Arbeitsmarkt (§ 16i SGB II, introduced by the Teilhabechancengesetz) | Wage subsidy of 100% in the first two years, then reducing by 10 percentage points a year, for people aged 25+ who have received basic income support for at least six of the last seven years |
| Australia | Wage subsidies | Up to $10,000 for businesses that hire eligible individuals into ongoing jobs |
| Netherlands | Loonkostensubsidie | Municipal wage cost subsidy for employees with a work disability, covering the gap between their productivity (loonwaarde) and the minimum wage, up to 70% of the minimum wage |
Structured Onboarding
Long-term unemployed hires benefit from more structured onboarding than typical new employees:
- Pre-employment: Workplace visit, meet the team, clear information about first day logistics
- Week 1: Orientation, buddy assignment, reduced workload, daily check-ins
- Weeks 2-4: Gradual increase in responsibilities, weekly check-ins, feedback loops
- Month 2-3: Full role expectations with ongoing support available
- Month 3-6: Formal review, discussion of development opportunities
Key Principles
- Assign a workplace buddy (not a manager) for informal support
- Provide written expectations — do not rely on "you'll pick it up"
- Be patient with confidence gaps — skills may be intact but self-belief may need rebuilding
- Celebrate small wins early to build momentum
Retention Strategies
- Regular check-ins beyond the probation period
- Access to Employee Assistance Programmes
- Training and development opportunities — signal that you are investing in their future
- Flexible working where possible to accommodate ongoing challenges
- Monitor and address any workplace bullying or stigma
Resources
- UK Sector-based work academy programme — employer guide: gov.uk
- UK Restart Scheme statistics and eligibility: gov.uk
- Australian Government wage subsidies: business.gov.au
- Netherlands employer subsidies for people with a work disability: rijksoverheid.nl