JobSeeker Cut to Push 370,000 into Poverty, Including 80,000 Children


New analysis from The Australia Institute shows the Government’s announcement to cut the JobSeeker supplement by $150 per week would push 370,000 Australians into poverty from September, including 80,000 children.

The specially commissioned modelling undertaken after Tuesday’s announcement also shows that the cut will result in hundreds of thousands of Australians would struggle to pay rent or service their mortgages, putting acute pressure on the housing market.

Key findings:

  • The Federal Government this week announced it intends to cut the JobSeeker supplement from September by $150 per week, which pushes 370,000 Australians, including 80,000 children, into poverty.
  • State breakdowns:
    • Victoria: 123,000 pushed into poverty, including 29,000 children
    • NSW: 89,000 pushed into poverty, including 15,000 children
    • Queensland: 91,000 pushed into poverty, including 21,000 children
    • WA: 32,000 pushed into poverty, including 8,000 children
  • Currently in Australia there are 13 jobseekers for every job vacancy.
  • If the government cuts the supplement, 270,000 mortgagees and renters who were not in poverty before COVID-19 will be forced into poverty.
  • This is expected to lead to significant difficulties in paying rent and servicing mortgages, which could negatively affect Australians who have investment properties.

“The Coronavirus Supplement has been an essential part of our nation’s response to this recession and has improved the lives of nearly half a million Australians. In fact, no other government has ever lifted so many people out of poverty so quickly,” said Matt Grudnoff, Senior Economist at the Australia Institute.

“It is disappointing to now see the Government pushing 370,000 Australians, including 80,000 children, into poverty with its announcement that it is cutting the supplement from September.

“Furthermore, it is concerning that the Government has refused to give jobseekers certainty by only applying this supplement through to December, meaning that hundreds of thousands of Australians could be thrust into poverty over Christmas.

“With the ongoing uncertainty surrounding the spread of COVID-19, particularly in Victoria, cutting the JobSeeker supplement will only serve to push vulnerable Australians into further desperate situations.

“As unemployment has increased over recent months, the JobSeeker supplement has been the only thing standing between many recently jobless Australians and poverty.

“This JobSeeker cut will mean hundreds of thousands of Australians will find themselves struggling to pay the rent or service their mortgages for the first time.

“This will impact homelessness, put pressure on the banking system and have a knock-on effect to property investors. Those who own residential investment properties should be particularly concerned about the government ending the coronavirus supplement.”

Related research