How behavioural insights can make better policy

Person using a lap top computer to access a job guide site

Well-designed, user-centred policies can improve job seeker's motivation to seek work

This story was first published on Thursday 24 January 2019. If you wish to use this content, please contact to confirm that the information is still current.

The Department of Jobs and Small Business is always looking at ways to improve the way employment policies are developed.

User-centred employment policy—policy that takes into account how job seekers, employers and employment service providers interact and make decisions—will ultimately deliver better services.

This was one of the key insights of a recent report published by UK-based Behavioural Insights Team (BIT). The report came out of trials that were a collaboration between BIT and the department.

‘Applying Behavioural Insights to Labour Markets’ offers a way to develop policy that places people and their decision-making front and centre. Using case studies, trials and analysis from the Department of Jobs and Small Business and other local and international labour market players, BIT recommended a range of ways that the department can apply behavioural insights. It offers improvements for job seekers, employers and employment service providers.

For job seekers, well-designed, user-centred policies can improve their motivation to seek work. It can shift their focus from maintaining their job search records and complying with their mutual obligation requirements to relationship-building and goal setting, simplify communication and better reflect their preferences to help them find work quickly and remain employed.

For employers, improvements to policy development using behavioural insights can increase the quality of their workforce. The report recommends employers should include salary ranges, incentives and negotiable aspects of a job in job ads, reduce or eliminate bias during recruitment, invest in workforce learning and development, allow flexible working arrangements and reduce paperwork.

For employment service providers, the report found that policy that improves the skills and motivation of staff, and facilitates greater collaboration and information-sharing amongst providers, builds an environment where staff can more genuinely match people with jobs.

One of the most important outcomes of applying behavioural insights to policy development is that centring policy on people and behaviour, rather than systems, builds robust policy that can cope with future challenges to the labour market, like the gig economy, globalisation, technological advancements and automation.

In one case study, BIT collaborated with the department and an employment service provider in Sydney to develop a website called ‘My Job Goals’. The site provided job seekers with instructions and templates for creating a CV and cover letter, and 10 job search tips.

The site increased the number of job seekers finding employment during the four months of the trial by 45%. If this could be scaled across the provider’s other sites, it could feasibly help more than 26,000 job seekers in each four-month period to find a job.

This could potentially cause a rethink about how governments deliver services and assistance to clients, allowing those job seekers who can to self-service online and freeing up time and resources for providers to give greater help to more disadvantaged job seekers.

Read ‘Applying Behavioural Insights to Labour Markets’.

Read more about behaviour economics projects by the Department of Jobs and Small Business:

'Using behavioural economics to increase wage subsidy take-up'

'Nudging franchisees towards more informed decisions'

Correct at time of publication.