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More young, white, middle-class people become beneficiaries, as 2,422 more people received Jobseeker Support last week

More young, white, middle-class people become beneficiaries, as 2,422 more people received Jobseeker Support last week
Image sourced from pxhere.

The rate at which people are going on Jobseeker Support has slowed in recent weeks, following a spike in late-March/early-April.

A net 2,422 people went on Jobseeker Support in the week to May 8, according to the latest Ministry of Social Development data.

So as at the end of last week, there were 186,826 people on Jobseeker Support. 

The number of new people to go on Jobseeker Support in a week peaked at 9,470 in the week to April 3.  

This could in part be because an influx of New Zealanders returned home from overseas before the borders were shut. 

Despite the slowdown, COVID-19 has seen a net 41,820 people go on Jobseeker Support. In other words, the number of people on Jobseeker Support increased by 41,820 in the seven weeks to May 8.

The 12-week wage subsidy is undoubtably playing a huge role keeping people employed. It’s paid $11 billion to support 1.6 million jobs and will be extended by eight weeks for businesses whose revenues are down 50% from last year (as opposed to 30% as was the requirement under the initial 12-week scheme).

More young, white, middle class require Jobseeker Support

Ministry of Social Development data shows that of the new people who have gone on Jobseeker Support since the lockdown, 45% were in their 20s. During the same period last year, 37% of new recipients were in their 20s.

Some of these young people would’ve been returning to New Zealand from overseas. The portion of new beneficiaries during lockdown who were overseas returnees was 12% (versus 5% last year).

45% of new Jobseeker Support recipients required it because they “ceased work”, while 22% said they had become “available for work”.

Compared to the same period in 2019, a larger portion of the new Jobseeker Support recipients previously had higher incomes.

A fifth previously earned between $585 and $880 a week, and a fifth earned more than $881 a week. Only 8% earned more than $1,201 a week.

Furthermore, 46% had little or no previous benefit history, compared to 26% last year.

And 65% were NZ European, “other”, or from unspecified ethnic groups, compared to 48% last year.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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48 Comments

There was also the small matter of the minimum wage increase

Multimillionaire or Stockholm syndrome?

"Returned to NZ" and hopped on the dole.

Here's hoping they will stay and provide their skills to the homeland.

What else could they do, businesses were closed?

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I would be more charitable if we were able to feed and house the NZers who actually live here, pay taxes here and send their kids to school here, but we can't even manage that at the best of times.

The idea that you can live the life of Riley on the other side of the world and not contribute to the state until you suddenly decide you need something from it doesn't really work when you have so many people living outside the country who have a right of return at the drop of a hat. A stand-down period would not be unreasonable.

In fact in typing this out I've come to the realisation that we have minimum work periods for things like Super and there probably is such a stand-down period and I just don't know it exists, so feel free to ignore me as 'likely wrong dude on the internet' - stick with what you know I guess.

A stand down is certainly viable and there is fairness argument there.

Although if we were to accept the premise that the reason welfare is broken is crap government the fairness argument turns a bit the other way, as in, why take out government failures on kids coming home in circumstances beyond their control?

It's a compelling argument, that kids shouldn't miss out. But you could use that to justify almost anything. What I want to know is why the kids of parents who live and work in NZ should get less because people who essentially use NZ as a passport office decide they suddenly need the safety net that people actually living here have funded. I'd rather we were more selective about who got benefits and gave them a humane amount to live off than leaving the welcome mat out for people who want to swan back whenever they please at our expense.

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Are you seriously suggesting NZ citizens shouldn't be allowed to come back to NZ and enjoy the same rights as any other NZ citizen? Do you understand the basic concept of citizenship?

If you make NZ unlivable for young people young people go overseas, it's not rocket surgery.

Well we already discriminate on this basis when it comes to super eligibility and returning to NZ. So we accept this as a pragmatic solution at times. Other countries take a far harsher stance on tax residency and expect contributions to maintain your citizenship. And we have a large cohort of overseas NZers who rightly have a right of return. How do you justify Kiwis who live and pay tax here supporting Kiwis who opted not to live and pay tax here?

I'm not questioning the right of return, I'm questioning why we let people who chose not bring a plate to a bring-a-plate function line up with the people who did as soon as their feet hit the tarmac.

They moved away to get a job that paid enough to pay off their student loan, start a family, and buy a house...impossible in NZ.

Absolute bull. All my kids have stayed in NZ. All paid of student loans. All either have, or deliberately choose not to but could, bought a house by age 30. With no direct help from parents.

The baby boomer generation, which I am one of in most cases do not appreciate just how good we have had it.
Free Education, affordable housing and higher wages in real terms.
Time to cut some slack for younger people trying to navigate their way through life.

That’s right Ralph. It’s like the illegal gun ‘buy back’. The money paid by the Crown was because they effectively seized lawfully held private property. It was ‘compensation’. The wage subsidy or dole or whatever is similar as the Crown has arbitrarily closed the economy, depriving people of their lawful right to work and trade.

Boo hoo.. give me back my semi auto ...and I'm keeping the money you gave me too!

And die in a pandemic.

""Returned to NZ" and hopped on the dole."

According to the property price optimists, the Kiwis returning to NZ were the potential buyers of property in NZ. If returning Kiwis are on financial support from the government, it seems unlikely that they will be potential house buyers.

So with the subsidy we have 41,820 people in 35 working days for an average of 1194 people a day.

I guess we won't know how many jobs it is propping up until it stops, but I am thinking those firms with some kind of market clarity are already resizing so that might be flattening the curve.

I certainly hope so anyway.

Ugh sorry Ralph, accidentally clicked on report on this and I can't seem to undo it. Someone take this button away from me, this is like the third time.

Ah well, mistakes happen. Have a great weekend.

It's not a big deal though. Let's apply some Covid-19 statistical logic to those numbers:

41,820 = 0.8% of the population.

Another angle for you. 41,820 x $250 = $10,000,000 a week or $520,000,000 a year (touch of rounding). Double that by year end or triple. What's your best guess?

Have a be a billion a year by year end I'd think.

Mind you we could save that if we all quick smart shifted to kiwibank....

Very good point. I'm curious to see what our resident property spruikers have to say about these numbers you've put forward though...they're experts in historic extrapolation techniques.

Watch as these numbers get bad, and then the numbers will be rearranged in ways so you can't compare and make sense. This is a government with communication skills, but those are not in our interest.
But they will be looking good.

So you are predicting lipstick on the pig then?

Yup expect some methodological changes to the way unemployment is calculated. While they are at it I am sure they will tinker with the CPI basket of goods for good measure. Don't want people to find out money printing causes inflation.

Haven't the numbers already been manipulated enough over the past 10 - 12 years?

ANZ’s Sharon says unemployment figures remains for longer than government expectation.

https://www.rnz.co.nz/news/business/416735/anz-predicting-higher-unemplo...

Well duh
Govt's projections are just pathetic wishful thinking.
How this stuff gets out of the so-called 'experts' in the agencies is beyond belief....

dp

This is the figure without considering the number of working hours reduced for employees.

At least it's a global issue, so they cannot bugger off to the UK or Aussie.

Should be interesting - perhaps less stereotyping of beneficiaries as lazy good for nothings, especially if a good proportion of the middle class end up on benefits or make work schemes. What will national do for dog whistles?

NZ Job Seeker Benefit appears to me to significantly under count the unemployed in this type of situation. Couldn't figure out why the NZ rate was so low. Then talking to my barber found out why. He is working and therefore his wife can not get a benefit.
She is out of work--but statistically missing.
US system quite different. People are not on the dole. Their employers (or they if self employed) pay into an separate Unemployment Insurance Fund each qtr. Takes from 1% to 8% out of paycheck to fund the insurance fund.-up to a maximum annual limit per employee. More layoffs an employer has the higher the premium. Its self funded so everyone laid off is eligible for INSURANCE payment. That's what this event is so hard on GIG workers who have been skating without paying all their payroll contributions--unemployment, social security, private hospital ins, pension contribution, etc. 30 Million in the US and many not eligible.

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Kiwis returning jobless from overseas is one of the elephants in the room in terms of unemployment.
Things are bad enough with people based here losing their jobs, let alone the kiwi diaspora returning en masse to the dole.
Another thing that has been alluded to elsewhere is people losing their jobs but being ineligible to get the dole, because their partners are earning too much. This will of course not register in the dole numbers, but will have significant economic / social impacts.

Agree. If you returned. From oe should be 12 week stand down, you should budget that when deciding to roam the world. Yes those who are not on job seeker because of partners will be fairly large number given small threshold. It's the mental side and sense of self worth that will really affect people who are used to working

Jobseeker is asset tested! Any assets over and above the threshold must be used prior to any payments being received.

Wonder how many have come back from the UK? This is food for thought and shows how prevalent the disease has been there.

https://www.telegraph.co.uk/news/2020/05/14/public-health-englands-lates...

Also how do you factor in things like reduced hours and 20% pay cuts ? Effectively thats another 1 in 5 out of work. As already pointed out as soon as your partner is still working you are not eligible for the job seeker benefit. Clearly the actual unemployment is far higher than any official figures indicate. Reality is in terms of actual financial impact we are going to have 20% unemployment in no time.

Just look at IRDs PAYE receipts. The effect of lower effective tax rate on reduced income somewhat reflects lower discretionary income.

Agreed,employees at my company have been doing 45-50 hours a week for the last 5 years. We are now on 40 without exception.

Liking being informed.. big ups Jenée, indeed essential... We shall see how the figures are when the subsidies subside. Every job needs earnings.
EDIT... Unless you are paid by the government or council...

Hopefully this is a helpful push towards a higher wage economy when you see that there are still thousands of trade, roading and construction and healthcare jobs listed on Trade Me. Hopefully the trades training scheme is helpful for the redundant tourism and hospitality staff.

Construction won't be picking up the slack. I promise you that. Most companies are not hiring at the moment. Some companies are asking employees to take salary sacrifices. Some companies will be making redundancies when the 12 week wage subsidy expires. Jobs are being canceled & pulled all over the place it's a fearful market.

After we have housing sorted for who is already here, that will be it, the ponzi scheme of mass immigration will stop, just as tourism has, travel will cease to be a thing for any but the wealthiest for some time, we may never see cheap flight again, that is probably not a bad thing in the long run. We will have to adapt

Just looked at flights to Rarotonga and Fiji from July onwards with AirNZ (a girl can dream). Going cheap cheap

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Days to the General Election: 37
See Party Policies here. Party Lists here.