Participation in education is increasing but employment rates are falling due to a lack of available jobs, Aboriginal Peak Organisations NT says.

Residents are living under immense economic stress - often paying three times the price for food and other essentials than in the city. Inadequate housing and poor health outcomes are also a challenge.

"The need for investment in jobs in remote communities remains large and unaddressed," chief executive John Paterson told a federal parliamentary committee on Indigenous employment and business on Thursday.

"We can't afford to keep doing the same old, same old and achieve the same disastrous results year in, year out."

Unemployment has become systemic in many communities with an Aboriginal employment rate of 37 per cent across the Territory.

Creating secure meaningful work leads to better outcomes than struggling to make ends meet on welfare payments, Mr Paterson said.

"In the larger remote communities in the NT if every job was taken up by the jobseekers in that community, the employment rate would still be half the national average," he said.

APO NT called on the federal government to spend less on improving welfare programs - such as the cashless debit card - and invest in jobs.

It's proposing a remote jobs investment fund to create 10,500 part-time jobs, a youth-focused work experience scheme and an enterprise fund supporting investment in business projects.

Mr Paterson said the plan would increase employment rates and skills in the communities while reducing poverty.

"It will also support Aboriginal-controlled community organisations and other local groups to deliver projects that address local economic, social and cultural objectives," he said.

The proposed scheme would fund Aboriginal organisations to employ local workers for 20-hour weeks with superannuation entitlements and training.

Small Indigenous organisations - such as health clinics, art centres, horticulture businesses and housing providers - would be supported to take on additional workers.

Ranger programs and cattle businesses could also be supported.

"Importantly, the wage subsidies must be able to last up to five years," Mr Paterson said.

This will increase employee participation rates in communities over time and address entrenched issues, he said.

APO NT's plan would also provide funding for 1500 paid work experience positions and training for Aboriginal youth each year.

It would help youths in remote areas with the skills to transition from school to work.

Management of the scheme would be shared between an independent Indigenous-led national organisation and government.

But first, bureaucratic red tape must be cut, Mr Paterson said

The scheme would allow the federal government to fulfil some of its commitments under the Closing the Gap agreement, the APO NT submission to the committee said.

Australian Associated Press