Unemployment payments

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. Where this is a regular payment that helps with the everyday costs of living, it is referred to as an income support payment, with the type of payment often reflecting life circumstances at the time of receipt.

This page examines the main income support payments for people aged 16 and over who are unable to find work or work sufficient hours – JobSeeker Payment and Youth Allowance (other). These payments are referred to on this page as unemployment payments (for brevity). Note that some people receiving these payments (people working insufficient hours or exempt from the mutual obligation to be looking for work) would not be defined as unemployed according to the Australian Bureau of Statistics (ABS) Labour Force Survey definition; see Employment and unemployment.

Unemployment payments are part of a larger network of labour market policies and services, designed to support individuals seeking further employment (see Employment services). Not all unemployed people will receive these unemployment payments, as they may receive other income support payments or not meet eligibility requirements. It was estimated that people receiving unemployment payments accounted for over 1 in 4 (28%) of those unemployed in 2017–18 (Parliamentary Library 2019).

This page also presents information on those receiving student payments, as receipt of unemployment payments is likely to be influenced by engagement with other activities (such as education and training), especially for people aged 16–24.

Information on government expenditure on these payments is included in Welfare expenditure. For information on unemployment and labour force participation, see Employment and unemployment. Also see glossary for definitions of all terms used on this page.

Unless otherwise stated, income support data are sourced from Department of Social Services payment demographic data (from September 2013 to March 2023) and from previously unpublished data derived from Services Australia administrative data (June 2001 to June 2013).

How many people receive unemployment payments?

As at 31 March 2023, 809,700 people (3.8% of the population aged 16 and over) received one of the following unemployment payments:

• 740,800 received JobSeeker Payment
• 69,000 received Youth Allowance (other).

The vast majority of people receiving unemployment payments were aged 16–64 (95% or 770,600), representing 4.6% of the population aged 16–64.

Trends

The number of people receiving unemployment payments increased from 662,000 in June 2001 to 908,800 in June 2022 (Figure 1). However, taking into account population growth over this period, the proportion of the population aged 16 and over receiving unemployment payments has remained relatively stable at around 4%.

Over the past 2 decades there have been various fluctuations in the receipt of unemployment payments coinciding with several economic downturns and changes to the social security system. In 2007–08, the proportion of the population aged 16 and over receiving unemployment payments dropped to below 3%, followed by an increase around 2009 in line with the global financial crisis. At the start of the COVID-19 pandemic in March 2020, the number and proportion of people receiving unemployment payments was the highest on record since 2001 – a peak of 7.8% in June 2020 or 728,200 additional people compared to March 2020. This steep rise in receipt of unemployment payments in the early months of the pandemic reflects the labour market impacts and the need for income support associated with widespread social distancing measures and activity/business restrictions to control the spread of the virus.

By September 2022, the proportion of the population aged 16 and over in receipt of unemployment payments had returned to pre-pandemic levels (4.0%). By March 2023 it had decreased slightly to 3.8% (with 76,500 fewer recipients than in March 2020).

This pattern of return to pre-pandemic levels has been consistent across all age groups and for males and females, despite those aged 15–24 and females having steeper initial increases in receipt of unemployment payments in the early months of the pandemic.

When analysing trends over the medium to long-term it is also important to monitor trends in the ‘working age’ population (those aged 16–64), given the growth in the population aged 65 and over in recent decades. Based on available data, the proportion of the ‘working age’ population receiving unemployment payments was declining before the pandemic (from 5.2% in June 2014 to 4.5% in June 2019) before increasing to 9.6% in June 2020 at the onset of the COVID-19 pandemic and declining again to 5.3% in June 2022. This is consistent with trends in the proportion of the population aged 16 and over receiving unemployment payments over this period (declined from 4.4% in June 2014 to 3.8% in June 2019, before increasing at the onset of the pandemic and then declining, as mentioned above).

For more information on the impact of COVID-19 on these payments, see ‘Chapter 3 Employment and income support following the COVID-19 pandemic’ in Australia’s welfare 2023: data insights; ‘Chapter 4 The impacts of COVID-19 on employment and income support in Australia’ in Australia’s welfare 2021: data insights.

Figure 1: Trends in people aged 16 and over receiving unemployment payments and other payments, June 2001 to June 2022

Notes

1. Data are as at 30 June in each year.
2. Data before 2013 may differ from official sources due to differences in methodology.
3. Before September 2020, unemployment payments included Newstart Allowance (before March 2020), JobSeeker Payment (from March 2020) and Youth Allowance (other). From September 2020, Sickness and Bereavement Allowance are also included in the JobSeeker counts.
4. A small number of people receiving income support payments are aged under 16 (70 for Parenting Payment Single, 5 for unemployment payments (Youth Allowance (other)), and 5 for Carer Payment in March 2023). These people are included in the numerator in calculating the proportion of the population aged 16 and over receiving these payments.
5. Per cent refers to the proportion of the population aged 16 and over receiving different payment types, using Australian Bureau of Statistics (ABS) Estimated Resident Population data for June 2001 to June 2022.

Source: AIHW analysis of Department of Social Services Benefit and Payment Recipient Demographics – quarterly data on www.data.gov.au (June 2014– June 2022), and of unpublished data constructed from Services Australia administrative data (June 2001–June 2013).

JobSeekers with a partial capacity to work

Over the last decade, the proportion of people receiving JobSeeker (and previously Newstart Allowance) and Youth Allowance (other) who had a partial capacity to work has doubled overall. However, there was a large fall during the COVID-19 pandemic, reflecting short-term policy changes, such as suspending mutual obligation requirements in March 2020 in response to the COVID-19 pandemic that were then gradually re-introduced after August 2020.

The proportion of people receiving:

• JobSeeker (and Newstart Allowance) with a partial capacity to work increased from 26% to 41% between June 2014 and March 2020, before falling steeply to 25% in June 2020. It then increased each quarter to reach pre-pandemic levels in March 2022, and continued to increase to 45% by March 2023.
• Youth Allowance (other) with a partial capacity to work increased from 9.2% to 15% between June 2014 and June 2019, before falling to 9.4% in June 2020. It then increased each quarter to March 2022 (17%), to levels similar to before the pandemic, and has since declined to 14% in March 2023.

Age and sex

As at 31 March 2023, the age distribution of people receiving unemployment payments was similar for each 10–year age group between ages 25–64 (around 18–22%). However, it was slightly lower for those aged 16–24 (16%) and considerably lower for those 65 and over (4.8%; Figure 2).

In recent years, the proportion of people aged 65 and over receiving unemployment payments has been increasing – from less than 5 recipients aged 65 and over in June 2017 to 41,800 (0.9% of the population aged 65 and over) in June 2022. This shift reflects the increasing qualifying age for Age Pension over this period (increased from 65 to 65.5 years on 1 July 2017, and to 67 on 1 July 2023; see Income support for older Australians for further details). Following each increase to Age Pension eligibility age since 2017 there has been a marked quarterly increase in the number of people receiving unemployment payments aged 65 and over. See ‘Chapter 3 Employment and income support following the COVID-19 pandemic’ in Australia’s welfare 2023: data insights for more information.

As at 31 March 2023, the number and proportion of males and females receiving unemployment payments was very similar – 3.9% of males and 3.8% of females aged 16 and over received unemployment payments (Figure 2).

First Nations people

As at 31 March 2023, 114,800 Aboriginal and Torres Strait Islander (First Nations) people (see glossary), received unemployment payments, representing 17% of First Nations people aged 15 and over. This compares with 3.4% of Other Australians (see glossary) aged 15 and over receiving unemployment payments. See Income and finance of First Nations people for more information.

Note that Indigenous status identification in most data collections is voluntary. This may influence the quality and completeness of the data and subsequent reporting on the number and proportion of First Nations people receiving income support payments, especially among older First Nations people.

Remoteness area

As at 31 March 2023, people aged 16 and over living in Very remote areas were 5 times as likely to be receiving unemployment payments as people living in Major cities (17% of people living in Very remote areas received unemployment payments, compared with 3.4% of people living in Major cities; Figure 2).

Figure 2: Number and proportion of people aged 16 years and over receiving unemployment payments, by selected characteristics, as at 31 March 2023

Notes

1. Proportions are as at 31 March 2023, using ABS population data (September 2022 for age group and sex and June 2021 for remoteness area). Duration of receipt is reported as a proportion of all unemployment payment recipients.
2. A small number of people receiving unemployment payments are aged under 16 (5 in March 2023). These people are included in the numerator in calculating the proportion of the population aged 16 and over receiving unemployment payments.

Source: AIHW analysis of Department of Social Services Benefit and Payment Recipient Demographics – quarterly data on data.gov.au (March 2023).

Earning an income while receiving income support

Means-tested arrangements are designed to ensure that income support targets those most in need, by assessing an individual’s income and assets to determine eligibility for a full or part-rate payment (see glossary). People receiving income support are required to report income from all sources (including work, investments and/or substantial assets).

As at 31 March 2023, for people receiving unemployment payments:

• almost one-quarter (23%) received a part-rate payment, which is slightly higher than in recent years (20% to 22% since 2019)
• around 1 in 5 (22%) declared earnings from employment in the preceding fortnight – 22% for those receiving JobSeeker and 21% for Youth Allowance (other). Of these, the vast majority (87%) earned at least $250 in the last fortnight
• the proportion who declared earnings dropped from 19% in September 2019 to 16% in June 2020, before increasing and stabilising around 22% from March 2021 until March 2023.

This increase in the proportion of people receiving unemployment payments with earnings since June 2020 may reflect the growth in employment over this period as well as short-term policy changes made to these payments during 2020 (which ended on 31 March 2021), including increasing the income free area for these payments from September 2020.

Duration of income support receipt

As at 31 March 2023, almost 1 in 4 (24%) people receiving unemployment payments had received income support for less than 1 year, with a further 29% receiving payments for 2–5 years and 37% for 5 or more years (including 19% for 10 or more years). People receiving unemployment payments are remaining on income support for longer than in previous years – for example, 29% had been on income support payments for 2–5 years in March 2023 compared with 24–27% between 2017 and 2019.

In terms of duration receiving the JobSeeker Payment specifically (or Newstart prior to March 2020), recipients are also receiving this payment for longer than in previous years. In March 2023, 56% of people had been receiving this payment for 2 years or more, compared with 44–49% between 2017 and 2019. Further, the proportion receiving JobSeeker/Newstart for 5–10 years has increased by 5 percentage points between 2017 and 2023 (from 12% to 17%), and more than doubled for those receiving this payment for 10 years or more (from 3% to 8% over this period).

See ’Chapter 3 Employment and income support following the COVID-19 pandemic’ in Australia’s welfare 2023: data insights for more information.

How many young people receive student payments?

Employment is tied closely with engagement with other activities, such as education and training. Hence, when describing patterns in unemployment payments it is important to also present income support payments available to support people studying or undertaking an apprenticeship.

Individuals in receipt of student payments are most commonly young people aged 16–24, with 77% of all people receiving student payments in this age range as at 31 March 2023. This section focuses on this age range.

Of people aged 16–24 in receipt of income support payments, 38% received student payments, 35% unemployment payments and 11% parenting payments.

As at 31 March 2023, 138,100 people aged 16–24­ (4.8% of the Australian population of this age) received one of the following student payments:

• 132,600 received Youth Allowance (student and apprentice combined)
• 5,400 received ABSTUDY (Living Allowance).

Before the COVID-19 pandemic, the number and proportion of young people aged 16–24 receiving student payments were generally declining, from 236,100 to 164,500 between June 2014 and March 2020 or from 8.3% to 5.6% of the population aged 16–24. However, following the business restrictions associated with the pandemic in March 2020, the number of people receiving student payments increased steeply by 39%, an additional 64,000 recipients in September 2020 or from 5.6% to 8.0% of the population aged 16–24. This was similar to the previous high rates observed in September 2015. These increases in 2020 may have been influenced by the COVID-19 pandemic and young people commencing or continuing to study due to unfavourable job market conditions.

The number of people receiving student payments then steadily declined to 4.8% of the population aged 16–24 in March 2023, 16% below March 2020 levels (26,500 fewer people receiving student payments), and between 18–21% below March levels in 2018–2019.

Figure 3: People aged 16–24 receiving student payments, June 2014 to June 2022

Notes

1. Data are as at 30 June in each year.
2. Per cent refers to the proportion of the population aged 16–24 receiving these student payments, using ABS Estimated Resident Population data for June 2014 to June 2022.

Source: AIHW analysis of Department of Social Services Benefit and Payment Recipient Demographics – quarterly data on www.data.gov.au (March 2023).

Where do I go for more information?

For more information about unemployment payments, see:

• Services Australia A guide to Australian Government payments
• Department of Social Services payment demographic data.