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THE UNEMPLOYED AND RECIPIENTS OF GOVERNMENT UNEMPLOYMENT BENEFITS - DIFFERENCES EXPLAINED
Figure 1. VENN DIAGRAM OF THE UNEMPLOYED AND RECIPIENTS OF NSA AND YAO: 2011-12.
A: Unemployed = 613,700
B: YAO = 71,400
C: NSA = 434,500
Source: ABS Survey of Income and Housing 2011-12 - data available on request.
REASONS FOR THE DIFFERENCES IN THE ABS UNEMPLOYMENT MEASURE AND COUNTS OF JOB SEEKER INCOME SUPPORT RECIPIENTS
Unemployed who are not job seeker income support recipients
People who are counted as unemployed by the ABS may not receive job seeker income support for a number of reasons. In addition to activity test requirements, applicants for NSA and YAO are subject to personal income and assets tests for themselves and their spouse. Unemployed people may not be eligible to receive income support payments if their partner's income, or value of own assets, exceeds the amount specified in the relevant personal income and asset test5. They may also be subject to an income maintenance period where a recent leave or redundancy payment from their previous employer is treated as income for the income test.
Some unemployed people may only expect to be out of work for only a short period, and may choose to support themselves financially through savings or the income of a spouse/partner. Others may be receiving another type of income support payment (such as the Parenting Payment or Disability Support Payment).
Job seeker income support recipients who are not unemployed
As noted above, there are a number of people who receive a job seeker income support but would not be included in the ABS' unemployment estimates. A job seeker income support recipient would not be classified by the ABS as unemployed if they undertook one hour or more of paid work in the reference week, or have not actively looked for work in the previous four weeks or are not available to start work immediately.
Job seeker income support recipients are able to undertake some paid work and continue to receive their payment until the income from that paid work reaches a specified level, at which time they become ineligible to receive further benefits. Recipients who undertook one hour or more of paid work in the reference week would not be classified as unemployed according to the ABS definition; rather they would be classified as employed.
Other recipients may be engaged in training, study or full-time voluntary work as part of the activity test requirements, which may mean that they are not available to start work. These people would not be classified as unemployed according to the ABS definition as they are not available to start work in the survey reference week; rather they would be classified as not in the labour force, and could form part of the group of people described as marginally attached to the labour force6.
Also some recipients may be temporarily exempt from the activity test requirements due to personal circumstances such as illness, homelessness or major personal crisis. These people would not be classified as unemployed according to the ABS definition if they did not actively look for work in the previous four weeks; rather they would be classified as not in the labour force, and also could form part of those marginally attached to the labour force.
While the ABS unemployment measure and counts of recipients of government job seeker income support payments both inform policy makers and analysts on people seeking employment, they differ in many ways. Not all people receiving NSA and YAO are unemployed according to the ABS definition, and conversely, only a proportion of all those classified by the ABS as unemployed received NSA or YAO in 2011-12.
The ABS unemployment measure is the official measure of unemployment in Australia and is the best source for an estimate of the number of unemployed persons and the unemployment rate. Counts of persons in receipt of government job seeker income support payments refer to those job seekers who have registered with the Department of Human Services for financial support during their search for work.
For further information on the various types of labour market or job seeker income support payments and the eligibility criteria refer to Department of Human Services website.
1. The counts of recipients of government job seeker income support are produced on a monthly basis in the publication Labour Market and Related Payments - a monthly profile. This publication presents statistical information on the various types of labour market payments delivered by the Department of Human Services on behalf of the Department of Social Services. (Department of Social Services, viewed 2 July 2014, <http://www.dss.gov.au/about-the-department/labour-market-and-related-payments-monthly-profile-publications>).
2. ABS defines the unemployed as: persons aged 15 years and over who were not employed during the reference week, and:
4. Youth Allowance is payable to eligible people aged 16–21 who satisfy the activity test or aged up to 24 if undertaking full-time study. To satisfy the activity test recipients must be actively seeking and willing to take up paid employment or undertaking activities to improve their employment prospects. People aged over 24 may be eligible if they were receiving Youth Allowance as an Australian Apprentice or full-time student before turning 24 and continue in that course or apprenticeship. Youth Allowance (Other) recipients are Youth Allowance recipients who are neither full-time students nor full-time Australian Apprentices (Department of Human Services, viewed 23 May 2014, <http://www.humanservices.gov.au/customer/enablers/centrelink/youth-allowance/eligibility-for-youth-allowance>).
5. Applicants of Newstart Allowance and Youth Allowance are subject to income and assets tests and thresholds. This varies according to whether the recipient: is single; is a member of a couple; has dependent children; is a dependent young person; or is aged over 60. Recipients are also subject to: parental and personal means test or personal means test (if the person is independent and single); or the partner and personal means test (if the person is independent and a member of a couple). The parental means test applies to dependent young persons, including those required to live away from home. From 1 July 2013 the rate reduces by 20 cents for every $1 the parent’s income exceeds $47,815. There is also an asset test and family actual means test (Department of Human Services, viewed 23 May 2014, <http://www.humanservices.gov.au/customer/enablers/income-test-allowances>).
6. People considered marginally attached to the labour force are those who were not in the labour force in the reference week, wanted to work and: