What’s Going On? Unemployment and Income Support – before and after COVID

Date & time: 12:15 pm (AEST), Tuesday 5th April 2022

Speaker: Peter Whiteford

Mode: Online Zoom webinar

Organiser: Australian Journal of Social Issues

For most of the past 40 years, changes in the number of persons on unemployment benefits and changes in the unemployment rate in Australia track reasonably consistently over time (ABS 2014a). This relationship has changed significantly since the onset of the COVID-19 pandemic. In February 2020, there were around 50,000 more people receiving payments than ABS unemployed, but by May 2020, this difference was around 730,000. Both the numbers of unemployed and the number on unemployment-related payments have since fallen significantly, but in December 2021 the difference was still close to 500,000 people, nearly three times greater than in any year before COVID.

There is a further challenge in understanding these developments. The ABS Survey of Income and Housing (SIH) identifies individuals by their labour force status and their receipt of social security payments, allowing more direct comparisons in one data source of differences between labour market status and benefit receipt before COVID. Studies using the SIH (ABS, 2014a; Vandenbroek, 2019) estimate that a large majority of the unemployed (around 70%) did not receive the major unemployment-related payments.

In brief, more people receive unemployment payments than the ABS measure as unemployed, but most of the unemployed did not receive these benefits before COVID.

This presentation draws on a paper by Peter Whiteford and Bruce Bradbury (forthcoming) that explores the differences between these indicators of labour market trends in Australia, highlighting changes in social security policy over time that contribute to these differences, and seeks to identify factors associated with the further divergence since 2020. The paper discusses the implications of these differences for analysis of the state of the Australian labour market, the assessment of the wellbeing of disadvantaged groups, as well as implications for social security policy and future research.

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