Two decades of welfare crackdowns by successive governments have resulted in a sharp rise in older women and people with disabilities languishing on unemployment benefits for longer.
A Parliamentary Budget Office paper issued on Wednesday reveals that, as of 2019, 62% of men receiving jobseeker payment are staying on the benefit longer than 12 months – up from 51% in 2007.
But the change is even more drastic among women, rising from 47.6% to 71.2%.
The analysis – which tracks the impact of big shifts in welfare policy dating back as far as the Howard years – confirms warnings from advocates and analysis by Guardian Australia that the unemployed are spending longer on benefits than ever before.
In 2007, 9.5% of women and 13.7% of men receiving jobseeker had been on unemployment benefits longer than five years. By 2019, it was 20.2% of men on the jobseeker payment and 24.4% of women.
Yet the most notable shift has been among older women. Women over 50 made up 4.9% of all jobseeker recipients in 2001. Last year, they were one-in-five of all dole recipients.
Since 1991, the proportion of women over 45 on jobseeker benefits has increased sevenfold, the PBO paper shows.
The researchers said during the 1990s and early 2000s jobseeker recipients had typically been young men in their 20s and 30s, while older men and women were likely to be receiving other benefits such as parenting payment, the age pension, or disability support pension.
“However, by 2019, this picture of recipients by gender and age group had changed considerably,” they said.
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Although the bulk of the paper examines the pre-Covid era, researchers warn the trends identified are unlikely to be altered by “short-term fluctuations in unemployment”.
They argue unemployment benefits now appeared to “function as a kind of pre-age-pension payment for some older Australians”.
The result is that over three decades, those on unemployment benefits have been likely to spend longer on a payment that has hardly changed in value. Jobseeker benefits are subject to tougher indexing arrangements than pensions, though it was temporarily boosted for the pandemic.
In 1991, the fortnightly rate of the jobseeker payment was $276.50. The payment was $565 a fortnight before the pandemic, or $815 with the current coronavirus supplement.
But the PBO put the inflation-adjusted value of the pre-Covid benefit at only $288.
Cassandra Goldie, the chief executive of the Australian Council of Social Service, said the report was “deeply concerning” given the country was experiencing “one of the worst recessions of our history”.
“We must ensure that those people who could not get paid work even before this crisis hit, including older women, are not left behind in entrenched unemployment,” she said.
The other large shift noted by the PBO is that those on jobseeker payment are far more likely to have barriers to full-time work such as caring responsibilities or a disability.
Conny Lenneberg, the executive director at the Brotherhood of St Laurence, told Guardian Australia women who lost their jobs at a mature age often faced discrimination from employers.
“There is this sort of presumption that because you’re older, you won’t be able to manage in the modern workforce,” she said.
Another issue was that women working in customer-facing industries such as retail or tourism were usually passed over for younger candidates.
“There’s a bar on appearance that really does impact on older women,” Lenneberg said.
The Howard government introduced the notion of ‘partial capacity to work’ in 2007 to reduce spending on disability payments. Those who are assessed as being unable to work more than 30 hours a week face more relaxed job search requirements.
The consequence is that last year 42% of people on jobseeker benefits had disabilities that prevented them from working full-time, compared to only 7% in 2007.
“As the overall prevalence of disability in the community actually decreased somewhat over a similar period, it is likely that the increase in job seekers with an ongoing partial capacity to work was driven by the tightening eligibility requirements for the DSP,” the PBO said.
In 2011, the Gillard government significantly tightened access to the disability pension, while further changes were made under Tony Abbott.
Other key factors identified by the PBO include the end of partner payments paid to women during the 2000s and, more recently, the decision to force single parents onto jobseeker payment once their child turns eight. The controversial move started under John Howard and was broadened under the former Labor government.
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The paper also tracks a period of massive change within the labour force, including the increasing number of part-time and casual jobs, and the privatisation and then continual overhaul of the much-maligned employment services system.
During the pandemic, the number of people on jobseeker payment rose to 1.46 million in May, up from 793,000 in March, with the increase driven disproportionately by young people unable to access the jobkeeper wage subsidy.
The PBO warns of likely “upward pressure” on jobseeker expenditure in the medium term driven by the fact many on benefits before the crisis were unlikely to move off the payment.
However, the “increased expenditure is at least partially offset by savings from other income support payments due to eligibility changes” to payments such as the age and disability pension.
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