Employment and income support following the COVID-19 pandemic

‘Employment and income support following the COVID-19 pandemic’ is Chapter 3 in the Australia’s welfare 2023: data insights.

This page provides a high-level overview of the key messages presented in Chapter 3.

Download the full article: Chapter 3 [PDF 1.5 MB]

Download the full report: Australia’s welfare 2023: data insights [PDF 11.1 MB].

The measures taken to control the spread of the COVID-19 pandemic have had extensive consequences for the Australian labour market and economy. 

This article explores how employment and income support in Australia have fared following the initial impacts of COVID-19 (that is, post-2020), focusing on the 3 years to March 2023, and with previous recessions and economic turndowns.  

In doing so, it reports on a range of employment-related measures, changes in working arrangements, and trends in income support and employment services. 

The article is organised into sections which aim to answer 3 questions:

  • Has employment recovered from COVID-19 in Australia?
  • Has the receipt of income support returned to pre-pandemic levels?
  • Has participation in employment services returned to pre-pandemic levels?

What is in this chapter?

Has employment recovered from COVID-19 in Australia?

This section explores how the pandemic affected employment and work arrangements, from the early months of 2020 – with the introduction of social distancing and other business-related restrictions to slow the spread of COVID-19 – until March 2023.

It provides longer term trends to highlight the impact of COVID-19 on employment and how the recovery compares with that for previous recessions and economic downturns. It also examines whether some population groups (and industries) were more affected than others, providing key insights that could inform economic policy to ensure that those people most adversely affected are receiving adequate levels of support.

This section highlights that Australia has made great progress in improving labour market outcomes, with most employment-related measures (employment, unemployment, and underemployment) rebounding quickly – faster than for previous recessions and economic downturns – and faring far better than they were before the pandemic. However, some parts of the labour force have been slower to recover, including industries that have a large share of part-time casual employees and were particularly affected in the early months of the pandemic (such as in the recreation and hospitality industries). Further, some changes to working arrangements that were accelerated by COVID-19, such as working from home, show no signs of reverting to pre-pandemic levels. 

Has the receipt of income support returned to pre-pandemic levels?

Australia’s social security system, administered by Services Australia, aims to support people who cannot (or cannot fully) support themselves, by providing targeted payments and assistance.

This section of the article examines trends (2001 to March 2023) in the main income support payments available for people who are unable to find work or to work sufficient hours (and who are under the income and assets threshold) – the JobSeeker Payment and Youth Allowance (other).

It highlights that income support receipt rose steeply in the early months of the COVID-19 pandemic but then returned to previous trends of a declining reliance on income support by September 2022. However, people receiving JobSeeker Payment are staying on payments for longer.   

Has participation in employment services returned to pre-pandemic levels?

The Australian Government funds employment services so that people receiving income support have access to support that will help them find and keep a job.

This section explores the caseload and outcomes of employment services in Australia, before and during the peak of the COVID-19 pandemic and in the months since (covering the period 2015–2023). 

It highlights that the number of people receiving mainstream employment services doubled at the onset of the pandemic but had returned to typical levels by late 2022 despite record low unemployment rate. 

Where do I go for more information?