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Companies hiring individuals unemployed for six months or more get 'golden handshake'

Employers can now take advantage of 2,500 in Government subsidies if they employ a member of staff who has been unemployed for six months or more.

Employers can claim a £1,000 ‘golden hello' for hiring a person who fits into this criteria and a further £1,500 for on-the-job training, as part of an initiative announced by the prime minister in January.

Commenting on the new scheme, James Purnell, secretary of state for work and pensions, said: "The impact of the global recession is being felt here at home and finding a job is not easy. We are investing £2 billion to help people get back to work as quickly as possible.

"Today businesses can take advantage of the new recruitment subsidy where we will provide up to £2,500 as an incentive to take someone on who has been claiming unemployment benefit for six months.

"This is just part of a range of measures coming in today to give people all the support we can - from CV writing and job searching to skills checks and training opportunities - to make sure where it happens unemployment is short-lived and people can quickly find their way back to supporting themselves and their families."

But Kevin Green, chief executive of the Recruitment and Employment Confederation (REC), said: "With regard to the golden hello incentive, the reality is that those employers who are still hiring are looking for job-ready staff and are unlikely to be swayed by the small cash incentive alone.

"Looking ahead, one of main issues will be how we maximise the opportunities of flexible options such as temporary, contract and interim work. It is vital that the time it takes to re-enter the benefits system does not act as a disincentive to those wanting to take short-term work opportunities which can provide a stepping stone back into the labour market."