Justice, Opportunity and Shared Wealth for all South Australians

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The real value of the increase in JobSeeker

This week’s Federal Budget will include the cost of the recent increase in JobSeeker and it will presumably look like a lot of money – but SACOSS’ latest Cost of Living Report provides new data which shows that the recent increase (which replaced the much higher Coronavirus Supplement) is in fact very small for people looking for work.
The SACOSS Report shows that:

  • $11 of the $25 a week increase simply catches up on inadequate indexation over the last 20 years – so it’s not a real increase at all
  • A household struggling to pay energy bills will have just an extra $1.50 per week to spend on energy
  • A household struggling to pay telecommunications bills will have just an extra $1.25 per week to spend on telecommunications
  • With food accounting for, on average, 19% of household expenditure for people on JobSeeker, the increase would give them just $4.75 a week more to spend on food.

Clearly the $25 a week increase announced in February is insufficient to make a substantive difference to the affordability of basic goods and services for people on JobSeeker, and the payment remains $177 a week below the poverty line.
SACOSS CEO Ross Womersley said:

"Our research uses the ABS Living Cost Indexes to track the real value of the JobSeeker payment and what we see in this case is that one-third of the increase just puts people on this payment back to where they were 20 years ago – while average wages and minimum wages have increased substantially. So this increase really does almost nothing to stop those people searching for work from falling behind – which itself makes it harder to get back in to work. It is a huge step backwards compared to when the Coronavirus Supplement was in place.
We also analysed the recent JobSeeker increase using SACOSS’ Utilities Stress Indicator research which looks at the proportion of income that can be allotted to paying energy, water and telecommunications bills without going into stress. For energy, it is 6% of income, 5% for telecommunications and 3% of income for water. So, a JobSeeker already paying above those thresholds would be even further above the stress threshold if they spent more than that percentage of the $25 increase on those bills. But allocating that proportion of the increase to utilities means that the increase really does not go very far in relieving any of those affordability struggles."
While next week’s budget will lock in the $25 increase in JobSeeker, much more needs to be done to support people to get back and into work, and really increasing the rate of JobSeeker remains unfinished business.

You can access a copy of the SACOSS Cost of Living Update No 46 (March 2021 Quarter) here.


Published Date: 
Sunday, 9 May 2021