Unemployment Benefit vs Wages

Are you up to date with the unemployment benefit? If you have no idea how it’s been, read this.

Age 21+, from 1985, per week, subject to indexation of 3% average per year:

Nov 1985        $91.45             ALP

April 1990       $130.00           ALP

March 1995     $150.75           ALP

March 2000     $165.80           LNP

March 2005     $199.65           LNP

March 2010     $231.40           ALP

March 2015     $259.60           LNP

March 2020     $282.85           LNP

https://guides.dss.gov.au/guide-social-security-law/5/2/1/20

I have heard and read comments by too many people who know nothing about UEB. They only understand wages, probably because they are on a wage. Wages growth is very different to Unemployment Benefit, 3.25% average per year but higher incomes (incl. salaries) have increased a lot more than that.

2002-2007       annual average 3.8% increase (19% over 5 years)

2007-2012       annual average 3.65% increase (18.25% over 5 years)

2012-2017       annual average 2.3% increase (11.5% over 5 years)

Wages increased much more than UEB, because of the basic percentage. Percentage is on what you already earned – 10% of $100 is $10, 25% of $100 is $25, 37% of $100 is $37. When your percentage amount is added on to your income, your next percentage is on what you earn now. So if you earned $500 in 2002, 3.8% is an increase of $19.00, taking you to $519.00. If your next increase in 2003 is 3.8% on $519, you will get another $19.72, taking you to $538.72.

A person on UEB in 2002 would be paid $187.27 and would only get a maximum 3%, $5.35, taking them to $192.62. That’s a lot less than a wage. https://treasury.gov.au/sites/default/files/2019-03/p2017-t237966.pdf

Average wage is all income added up and divided by the number. Median is the middle of numbers – as many above the middle and as many below. The median in 2020 was $1,700. I have used average.

In 1985 the average wage to 31 March was $377.50. Now, in 2020, it is just over $1,300. The difference between wages and UEB went from $286.05 in 1985 to $1,017.15 in 2020. The difference was 76% in 1985. Now it is 79%, and getting worse every year – and it is based on percentage rather than the actual amount paid. https://tradingeconomics.com/australia/wages and  https://www.ausstats.abs.gov.au/ausstats/free.nsf/0/E71E86B76C8056F6CA2574FF0019D1CF/$File/63020_MAR1985.pdf

I would ask a question of those who consider the people on UEB as ‘dole bludgers’: would you rather get a benefit of $282.85 rather than a wage of $1,300? Oh yes, I know you will add on all the extras people get on a benefit – rental assistance (why don’t they own their own home?), carer assistance (do you know who that is paid to?), a pension supplement for older unemployed people (why has the retirement age changed?), an energy supplement (essential, because power is essential) et al. But the basic income is still $282.85, with an addition from March of $25 per week after this government has seen the “necessary” increase. (Personally, I think it should have stayed with the current Job Seeker coronavirus supplement which is now $75 per week.)

According to Canberra Times in February 2020, 1 in 8 from the working population are living in poverty. https://www.canberratimes.com.au/story/6641748/one-in-eight-australians-living-in-poverty/

If that is getting worse, then we should feel pretty bad for not helping anyone on any benefit, and much more so than discriminating against those on benefits – because the vast majority of those people did NOT choose to be there!