There are two objections to this argument.
Firstly: how do we rehabilitate crimes that are not of necessity - violent or white-collar crimes. They may be a proportionally smaller number but are often just as impactful either because of the loss of human life or the financial crippling of thousands of people.
Given that these crimes are just as important, even if they are not as numerous - how do we deal with them.
It feels like a purely rehabilitative prison system would never incarcerate white collar criminals if they pinky promise to never do it again.
Yet these are often the individual crimes that harm the largest number of people - either through lower tax revenue because of tax evasion, or straightforwardly through disasters like Enron.
Given that white collar crime is disproportionately committed by the wealthy, you would be exacerbating the incarceration of the poor.
Secondly, even when it comes to rehabilitation by means of job training, the chances of such a program being successful isn't particularly high. Vocational training schemes already exist, but getting funding for them is very challenging. Appearing to mollycoddle prisoners is often political suicide, particularly given that many countries don't give prisoners the right to vote or care more about crime prevention than their particular rights.
If you want to give at risk populations the chance at economic opportunity - invest the money you would put into prison training schemes into schools and internships for non-offenders to prevent them from ever straying into crime in the first place.