The Federal Government is considering a recommendation that would see young unemployed people forced to move to areas with more opportunities.

But the Productivity Commission’s latest report suggests such measures are not particularly effective.

The recommendation before the government would see single, unemployed people between the ages of 22 and 30, who have been on the dole for 12 months, forced to move to places of higher employment.

The Coalition has a plan to give $6,000 to long-term unemployed jobseekers moving to a job in regional areas, and $3,000 if they move to a city.

The Productivity Commissions latest report, ‘Geographic Labour Mobility’, says incentive payments can help, but government assistance packages are not an effective cure-all.

Productivity commissioner Alison McClelland says packages to aid the transition of auto-manufacturing workers in Victoria and South Australia should be watched closely.

“Mobility can help if someone is losing a job, but it's not always the answer,” Ms McClelland has told the ABC.

“When we talk to the employment service providers of those people who have moved, they told us they often needed a lot of support at the destination end.

“They often have no-one there that they know to help them out. It can help some people but it's not a panacea and it's not a comprehensive solution.”

“The research didn't indicate that was an important measure that [the Government] should take up, when we looked at what would be helpful to help unemployed people get jobs.”

The Federal Government has flagged an ‘earn or learn’ approach to youth unemployment benefits in the upcoming budget.