Five charts on what a Newstart recipient really looks like

Unless we know who Newstart recipients are, we are likely to make wrong decisions about how much to pay them and whether to drug test them.

Five charts on what a Newstart recipient really looks like
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Owain Emslie, Grattan Institute and Danielle Wood, Grattan Institute

The Newstart unemployment benefit is all over the news. It’s the subject of a Senate inquiry. Today it will take evidence in Elizabeth, in what used to be Adelaide’s industrial north.

Should it be higher? Should recipients be paid with a cashless card? Or drug tested? Or stripped of their payments if they join climate protests?

To make sense of these proposals it helps to know something about who receives Newstart payments. It’s a picture many of us get wrong.


Read more: Are most people on the Newstart unemployment benefit for a short or long time?


Here’s a heads-up. They are not particularly likely to be young, they are are not especially likely to be men, and more live in regional areas than we might expect.

Here are some facts to give us something to work with, set out in five charts:

Likely to be middle aged
First, Newstart recipients are a lot older than you might think.

Half are over 45. Partly this is because unemployed people aged 24 or younger are more likely to be getting Youth Allowance.

But even if we include unemployed Youth Allowance recipients in the figure, an outsized 45% of all unemployment benefit recipients are over 45. One quarter are over 55.

Women on Newstart are older still: 51% of female job-seekers are over 40, compared with 42% of male job-seekers.


Youth Allowance (other) excludes student and apprentice youth allowance. DSS Payment Demographics, March 2019


They are older on average than five years ago.

Over the five years to March 2019, the number of people on Newstart aged over 45 swelled by one fifth, and the number over 55 by two fifths. At the same time the number under 45 fell by 16%.

The increase in the number of older people on Newstart has coincided with a sharp decline in the number of older people receiving the Disability Support Pension.

Tighter assessment measures since 2012 have led to a decline in the number of people being assessed as eligible for the Disability Support Pension, forcing many declined applicants on to Newstart.

Less likely to live in big cities
People from the biggest states are less commonly on Newstart.

Someone from Victoria, NSW, or the ACT is about one third less likely to be on Newstart than someone from the rest of the country.


DSS Payment Demographics, March 2019, ABS 3101.0


Rural areas also have higher proportions of people on Newstart than cities.

Someone outside a major city is one and a half times as likely to be on Newstart as someone in a major city. And the difference gets starker the further out you go.

Someone in a “remote” or “very remote” area is more than twice as likely to be on Newstart as someone in a major city.


Population at March 2019 is estimated based on ABS data at June 2018. DSS Payment Demographics, March 2019, ABS 3281


Likely to have been on it for a long time
Contrary to claims by Finance Minister Mathias Cormann and others, Newstart is not always a transitional payment.

It’s true many of the people coming on to Newstart leave it soon after: of those who began receiving Newstart payments in 2017, 63% had come off within 12 months.

But a focus on new recipients ignores the bulk of current recipients, who have been on it for much longer. Someone who has recently begun receiving Newstart payments is far more likely to move off them than someone who’s been on them for a longer period.

As at March 2019, two thirds had been on it for more than a year. One fifth had been on it for more than five years. A significant 4% had been on it for more than ten years.

Older recipients are more likely to have been on it for more than a year, and across all ages, women are more likely than men to have been on Newstart for more than a year.


Includes Newstart and Youth Allowance (other) recipients classified as ‘job seekers’. At August 2019, job seekers made up 52% of all Newstart and Youth Allowance (other) recipients. Labour Market and Related Payments Monthly Profile, August 2019


Tasmanian and Northern Territory recipients are the most likely to have been on it for more than a year; ACT and Queensland recipients are the least likely.

But across all states, a clear majority of recipients have been on it for more than a year.


Includes Newstart and Youth Allowance (other) recipients classified as ‘job seekers’. At August 2019, job seekers made up 52% of all Newstart and Youth Allowance (other) recipients. Labour Market and Related Payments Monthly Profile, August 2019


So next time you picture a Newstart recipient, it might be wise to think of a middle aged woman living outside of the city in a smaller state.

Unless we keep her in mind, we are likely to make the wrong decisions about the rate, about drug testing, and about everything else.The Conversation

Owain Emslie, Associate, Grattan Institute and Danielle Wood, Program Director, Budget Policy and Institutional Reform, Grattan Institute

This article is republished from The Conversation under a Creative Commons license. Read the original article.

What was your opinion of what a Newstart recipient looked like? Did you have it all wrong?

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    COMMENTS

    To make a comment, please register or login
    VeryCaringBigBear
    4th Nov 2019
    9:57am
    Take into account all those under 22 who can't get a job and can't get Newstart because their parents earn more than $50,000 and you will have a lot more young unemployed people than older ones. It is simply wrong to expect parents to support adults over 18 years of age.
    TREBOR
    4th Nov 2019
    10:08am
    Absolutely - at what point does an 'adult' with voting rights etc become an adult and thus supposedly independent?

    The entire range of budget spending needs a long, hard look ... not just cherry-picked parts of it... then the tax rules need to be properly aligned with the 21st Century ... then any number of other things need to be aligned with the 21st Century such as politician 'super' and so forth... NOBODY feeds a casual contracted employee already on a good gig for life...
    Paddington
    4th Nov 2019
    10:11am
    Read above more carefully. Youth are on youth allowance not Newstart. The more remote you live the more likely you are to be on Newstart. People who were on disability have been switched to Newstart because it is less money. No mention of sickness which is lower than Newstart at $250 per week.
    TREBOR
    4th Nov 2019
    10:22am
    Then there's student allowance, Paddo - another bugbear of mine: -

    Youth Allowance - a payment for full-time students and Australian Apprentices aged 16 to 24 years old.

    Austudy - a payment for full-time students and Australian Apprentices aged 25 years and older.

    ABSTUDY - a living allowance payment plus a range of extra benefits for Aboriginal and Torres Strait Islander students.

    Contrary to the philosophy that study is essentially 'unemployment' - I see that study is an investment in the future of the nation.... and should be rewarded as such...

    Having Austudy at $455 pf = $277.50 pw = the classical $40 a day... same as Unemployment....

    We need some revamping... what kid from a poor background can study medicine far from home on that rate? That means - once again - a classed society and one in which the financially better-off get all the benefits...

    I speak as the kid from the poor branch of the family who had no chance of med school despite ability etc and who had no support at home... whereas other 'branches' had a sweet run... then there's affirmative action - don't get me there...
    TREBOR
    4th Nov 2019
    10:23am
    make that ... 'what poor kid far from home or without a home' .....
    VeryCaringBigBear
    4th Nov 2019
    11:05am
    Youth under 22 are only on Youth Allowance if their parents earn less than $50,000 so there is a lot under 22 not getting anything even though they are adults.
    jackie
    4th Nov 2019
    12:34pm
    TREBOR, Study should cost nothing because it is an investment for this country and Australians have to study longer than ever because we have incompetent Governing that does not create industries and jobs for Australians. It’s too busy serving greedy billionaires that wants slave labor for nothing.
    TREBOR
    4th Nov 2019
    7:55pm
    Yes, jackie - 'third world' countries such as India have free education - that's why we have so many Indian doctors... they aren't burdened with a heavy debt for years for their work ... still falls mainly to the 'better' classes, of course.. what village boy or girl has the wherewithal to go and study while the parents till the fields and fight the cobras off?

    Rather than spend seven years or so studying and poor (unless you are in a rich family etc), who wouldn't go out and drive a truck for the dollars NOW?
    musicveg
    5th Nov 2019
    2:36am
    Family allowance stops the year your child turns 19, once upon a time it was 25 and slowly it crept down to 19 (only if the child is not getting any other allowance or are working of course).
    jaycee1
    6th Nov 2019
    9:46am
    musicveg - Family allowance stops at 19 - where once it was 25!!!!!!

    Excuse me, but we NEVER received the family allowance once our kids reached 16 and they were NOT working but still at school - so why the hlel should anyone be getting it until they are 25 or 19??????
    musicveg
    6th Nov 2019
    8:54pm
    I think it depends on your household income and whether parents are working or on newstart or other pension.
    Hoohoo
    6th Nov 2019
    10:33pm
    I understand that a child older than 16 can receive Austudy if they are still at school or studying in higher education. I don't know where or if any means-testing comes in. If they can prove they are independent of their parents (moved out) then they are eligible regardless of their parents' income.
    TREBOR
    4th Nov 2019
    10:06am
    Very good - thank you. Easy to see where the lies are coming from...

    Now - we want a solution... is it Shorten's 'national wage', wherein everyone gets a mandatory minimum (remember my past argument about superannuation and the need for those on next to nothing to have a minimum contributed into an account and not raped by costs and fees or the whole exercise is meaningless)... is it simply a loosening up of the requirements.. is it mass transportation of those in regions remote to 'areas where there are jobs'?
    tisme
    4th Nov 2019
    10:08am
    i was told your responsible for your kids to the age of 25 but u dont have any rights over them what a system wat a bunch of politicians ( wanna be gods ) we hav e
    TREBOR
    4th Nov 2019
    10:10am
    Bunch of self-blinded, self-serving nodding clowns with no real idea.... never been there so not a jot of empathy or even basic perception ...

    Plebiscites To the People NOW!
    TREBOR
    4th Nov 2019
    10:13am
    The greatest danger to the parliamentary system is democracy - conversely the greatest danger to democracy is the parliamentary system....

    Think it through... does our representative system really reflect the will of the people... or just of the party and its cronies?

    Not difficult to add a few referenda to every voting slip... plenty of issues out there that need the fair input of the people, and a move away from government by proxy and stealth (such as through 'boards' appointed), and direct imposition without leave by elected bodies without consultation or valid reference to the people...

    Maybe we need a new catchcry - for politicians - No Superannuation Without representation!
    johnp
    4th Nov 2019
    12:14pm
    As I have said before. Both LNP and Labor are like the nazis. LNP got into power thru lying, cheating, bullying and conniving. Labor lost cos they could not explain their policies; they are like the guards in hogans heroes
    jaycee1
    6th Nov 2019
    9:53am
    tisme, At one stage you were considered an adult at 21 - then they lowered it to 18. So when did they make it 25???

    If a person can get a car licence from 17 why are the parents still responsible for that person. Especially if, as you say, the parents have no rights in regards to them!
    Farside
    6th Nov 2019
    10:33am
    Children in full time study through to age 21 are considered dependents and not eligible for Youth Allowance except in particular circumstances. My sons were still at university so only went onto Youth Allowance when they turned 22 and were considered independent.

    Youth allowance is available for full-time students and apprentices from 16-24 years old subject to conditions.

    Family allowance cuts out at 16 AFAIK.
    musicveg
    6th Nov 2019
    8:53pm
    Family allowance only cuts out at 16 if you are the child is getting youth allowance or other. It cuts out at end of the year they turned 19 depending on the household income.
    SuziJ
    4th Nov 2019
    10:28am
    Now tell me why the government wants to drug test those on the Newstart allowance?

    'Most' of them according to the statistics above are over the age of forty, and even into their 60s just waiting to go onto the Age Pension.

    We wouldn't have the means to purchase drugs (not on Newstart, anyway), let alone pay for our everyday bills which most are struggling to do with the payment over $300 less than the DSP or Age Pension, which most say is not enough.
    Ms Logik
    4th Nov 2019
    1:42pm
    And people that are just over 60 now have to wait until they are 67 to receive the Age Pension due to the fact that the age for the Age Pension was put up.
    Mariner
    4th Nov 2019
    5:54pm
    Here on the Gold Coast, SuziJ, there are many with rings in their noses and pins in their eyebrows well below the 40s, they cannot get a job. Now would you employ them? - if I did not have a shave in my day I was sent home again. I do know times have changed but the people who employ others haven't changed all that much.
    cupoftea
    4th Nov 2019
    1:28pm
    What I have just read how long has this been going on
    libsareliars
    4th Nov 2019
    1:46pm
    I don't care who is on Nowstart - whoever is on it it should be raised by $100 per week. Talk about the land of the unfair go.
    Farside
    4th Nov 2019
    3:16pm
    and not to forget that Newstart is means tested. Consequently the unemployment numbers conveniently exclude the many older unemployed who find themselves forced to run down savings, which goes to makes their future retirement funding all the more problematic and increase risk of being on the public purse
    Mariner
    4th Nov 2019
    5:50pm
    Means test for the old pensioners why not for Newstart?. I know people having lost their jobs getting nothing because they have assets. You have a great job and all of a sudden it's gone - of course you like another. Volunteering won't do the sums.
    TREBOR
    4th Nov 2019
    7:59pm
    Not a good thing long term, Farside, since that inevitably means they will get more pension - so forcing those kicked to the gutter to wind down their assets is merely postponing the inevitable...

    Not good government.... stupid is the word...

    The only criterion for unemployment benefit should be that you are out of work...
    Ms Logik
    4th Nov 2019
    4:59pm
    And please don't forget that we older Newstart Allowance recipients do our 15 hours volunteering per week instead of looking for a job to be eligible for Newstart. We are not bludgers, we do our bit for society.
    TREBOR
    5th Nov 2019
    12:44am
    Gee, this joint is dead between elections, Igor... if the plants don't come back it'll become a dead rubber....

    Oh, well - at least we get to know who the dedicated ones are... those who actually want to contribute to discussion.... but we can wait for 'lothario' to resume his post... tell us all about his family company etc, how he and it pay no tax and he gets all the girls.... (rofl emoticon required)...

    No wonder Shorten had a stab at chopping that kind down... not a tax dollar between them... parasites... and what's legit today may not be tomorrow - look at Ayers Rock and the current rush at the Glasshouses and Mt Warning by the Indigenes...

    Jeez we Wharteys must be a non-spiritual lot.. could've fooled me... we could've always put 'em all on the chain gang on on a reservation.. now they demand reservations... Apartheidists ...
    musicveg
    5th Nov 2019
    2:45am
    Seems that Newstart recipients are getting older, the longer you are without a job the more likely you will still be on Newstart as you get older, and of course they did mention that more people who use to be on disability are now on Newstart. Employees want them young to pay less and because they feel older people are at more risk of getting sick and taking sick leave, or just simply they cannot keep up with the pace that employers expect these days.
    Farside
    5th Nov 2019
    9:41pm
    I don't think it is so much a matter of employers preferring young hires to older workers for the reasons you give, but more a case of the older workers not having any distinctive advantage. Age and experience matters little for many job when all things being equal seniors have no more relevant expertise than middle aged workers supporting families and cost more than younger workers trying to get a jump on their careers. Unemployed seniors have had decades to accumulate savings and wealth, and many have families to help support them so why not preference workers not yet in the twilight of their careers. Bottom line is there are not enough jobs to go around, competition is tough and seniors are at a disadvantage. Automation will ensure the job queues keep getting longer leaving few options for older workers. It's time for seniors to take a different path and look at jobs where there is reduced competition if they expect to compete on a more even playing field.
    musicveg
    5th Nov 2019
    10:04pm
    Yes true about not enough jobs to go around, but how to solve this when we are increasing the population all the time without spending enough on infrastructure which in turn would create more jobs. But with so many companies heading overseas for cheap labor what hope is there?
    Farside
    6th Nov 2019
    10:18am
    from experience I took contract roles in locations likely to attract fewer applicants and with older than average workforces
    BorntoolateRetiredtooearly
    6th Nov 2019
    8:07pm
    Why are retired couples , who are travelling around Australia in their caravans able to claim Newstart . They are aged between 60 and 65 and have not accessed their Super. I thought Newstart was for the unemployed looking for employment !
    Farside
    7th Nov 2019
    5:15pm
    thought wrong old mate ... can do volunteer work for 30 hours per fortnight as alternative to competing for paid jobs at 60
    VeryCaringBigBear
    8th Nov 2019
    10:20am
    They can't have much in super as they would be paying 15% tax on any earnings which could be as much as Newstart.


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