Contents

Main benefits

Unemployment Benefits

Definition of Unemployment Benefits

This group of main benefits comprises:

Recent changes in the administration of Unemployment BenefitsTop

From September 2010, clients receiving an Unemployment Benefit were required to reapply for their benefit every 12 months. This process:

Eligibility by specific benefitTop

Unemployment Benefit

Who is it available to?

An Unemployment Benefit is available to people who are:

To receive one, clients must be:

Income and residency tests, and pre-benefit requirements

Income and residency tests apply. Clients applying for an Unemployment Benefit must meet all the pre-benefit requirements before receiving a benefit. Pre-benefit requirements may include such activities as attending pre-benefit seminars or applying for jobs.

Work obligations

Recipients are subject to a full-time work test. This requires them to seek and to be available for full-time work.

Completing approved training may be counted toward the fulfilment of work-test obligations.

The spouses and partners of recipients also have work obligations

The work obligations of a spouse or partner depend on the age of the couple’s youngest dependent child.

From September 2007, a spouse or partner is subject to:

– aged over 18, or
– aged 18 and not engaged in full-time education or training
– aged 6–17, or
– aged 18 and engaged in full-time education or training.

If a couple’s youngest dependent child is aged under 6, the spouse or partner is (if required to by their case manager) obliged to:

For details of the work testing of spouses and partners before September 2007, see The Statistical Report for the year ending June 2010.

Unemployment Benefit – Hardship

Who is it available to?

An Unemployment Benefit – Hardship is available to people who:

Income and asset tests, and pre-benefit requirements

Income and asset tests apply. The same pre-benefit requirements apply as for the Unemployment Benefit.

Numbers of clients receiving an Unemployment BenefitTop

The number receiving an Unemployment Benefit decreased between 2010 and 2012

This decrease followed increases between 2008 and 2010 (see table UB.1).

The decrease between 2010 and 2012 reflected a combination of:

A small number of Unemployment Benefits were received by non-working-age clients (see table UB.1). These were mostly paid to people aged 65 and over who had not yet transferred to New Zealand Superannuation or a Veteran’s Pension.

For more information on policy changes affecting clients receiving Unemployment Benefits, see ‘Numbers receiving assistance’.

table UB.1: Numbers receiving an Unemployment Benefit

Client age at end of June Clients receiving an Unemployment Benefit1
2008 2009 2010 2011 2012
Working-age clients receiving benefits 17,710 50,855 62,085 56,264 49,622
Other clients receiving benefits 161 181 175 59 46
Total clients receiving benefits 17,871 51,036 62,260 56,323 49,668

Note

  1. The number of clients recorded in SWIFTT as receiving an Unemployment Benefit at the end of June.

The decrease largely reflected an excess of cancellations over grants

In 2010/2011 and 2011/2012, cancellations of Unemployment Benefits exceeded grants of Unemployment Benefits (see table UB.2 and table UB.3). This compares with 2008/2009 and 2009/2010, when the reverse applied.

This pattern reflected a combination of changes in economic conditions and Work and Income’s focus on moving as many benefit recipients as possible into work.

The number of Unemployment Benefits granted remained relatively flat between 2010/2011 and 2011/2012

This followed a decrease between 2009/2010 and 2010/2011 (see table UB.2). This pattern largely reflected changes in economic conditions (a deepening of the recession in 2008/2009 followed by a slow easing beginning in 2009/2010).

A small number of Unemployment Benefits were granted to non-working-age clients (see table UB.2). Most of those benefits were granted to 16–17 year olds who were supporting dependants.

table UB.2: Numbers granted an Unemployment Benefit

Client age when benefit granted Grants of an Unemployment Benefit1
2007/2008 2008/2009 2009/2010 2010/2011 2011/2012
Benefits granted to working-age clients 56,094 102,367 117,783 109,480 110,165
Benefits granted to other clients 93 108 129 92 79
Total benefits granted 56,187 102,475 117,912 109,572 110,244

Note

  1. The number of successful applications for Unemployment Benefits recorded in SWIFTT during years ended June.

The number of Unemployment Benefits cancelled remained relatively flat between 2010/2011 and 2011/2012

This followed increases between 2007/2008 and 2010/2011 (see table UB.3). This pattern reflected changes in the number of clients receiving an Unemployment Benefit as well as:

A small number of cancellations by non-working-age clients (see table UB.3) were the result of people reaching 65 years and transferring to New Zealand Superannuation or a Veteran’s Pension.

table UB.3: Numbers cancelling an Unemployment Benefit

Client age when benefit cancelled Cancellations of an Unemployment Benefit1
2007/2008 2008/2009 2009/2010 2010/2011 2011/2012
Benefits cancelled by working-age clients 61,240 65,940 106,105 115,783 116,311
Benefits cancelled by other clients 677 454 423 456 345
Total benefits cancelled 61,917 66,394 106,528 116,239 116,656

Note

  1. The number of cancellations of Unemployment Benefits recorded in SWIFTT during years ended June.

The number of transfers from Unemployment Benefits increased between 2007/2008 and 2011/2012

Increased transfers from Unemployment Benefits (see table UB.4) largely reflected increased grants of training-related benefits. This reflected a combination of:

table UB.4: Transfers from an Unemployment Benefit by working-age clients

Type of transfer Transfers from an Unemployment Benefit 1
2007/2008 2008/2009 2009/2010 2010/2011 2011/2012
Transferred to New Zealand Superannuation, pension or another type of main benefit 17,448 19,120 21,017 22,841 29,848
Transferred within the group of
Unemployment Benefits2
1,503 2,067 3,686 5,056 5,347
Total transfers 18,951 21,187 24,703 27,897 35,195

Notes

  1. The number of transfers from Unemployment Benefits by working-age clients recorded in SWIFTT during years ended June. The dates of these transfers reflected the dates at which a new benefit was granted, not the dates at which a former benefit was cancelled.
  2. A transfer within the same group of main benefits is recorded because a client’s benefit was cancelled then resumed as part of reviewing the client’s needs and entitlement to assistance.

A relatively small number of working-age people received an Unemployment Benefit

In 2012, an estimated 1.8% of working-age people were receiving an Unemployment Benefit, down from 2.3% in 2010. Since 2009, people aged under 30 have been more likely than older working-age people to be receiving an Unemployment Benefit.

See table OT.3 for information about use of Unemployment Benefits since 1940.

More information about recipients of Unemployment Benefits

Clients receiving an Unemployment Benefit were less likely to be young people

Twenty-six percent of working-age recipients of an Unemployment Benefit in 2012 were aged 18–24 (see table UB.5). This compared with 33% in 2009.

During the same period (see table UB.5):

table UB.5: Ages of clients receiving an Unemployment Benefit

Age of client at the end of June 2008 2009 2010 2011 2012
Working-age clients receiving an Unemployment Benefit1
18–24 years 3,639 16,705 19,024 16,363 13,114
25–39 years 5,957 16,690 20,377 17,598 15,342
40–49 years 3,341 8,793 11,316 10,733 9,951
50–59 years 2,428 5,969 8,214 8,410 8,286
60–64 years 2,345 2,698 3,154 3,160 2,929
Total working-age clients receiving benefits 17,710 50,855 62,085 56,264 49,622
  Other clients receiving an Unemployment Benefit1
Total other clients receiving benefits 161 181 175 59 46
  All clients receiving an Unemployment Benefit1
Total clients receiving benefits 17,871 51,036 62,260 56,323 49,668

Note

  1. The number of clients recorded in SWIFTT as receiving an Unemployment Benefit at the end of June.

Nearly three in four Unemployment Benefit recipients had received their benefit for under 12 months

Between 2010 and 2012, around 73% of working-age Unemployment Benefit recipients had received their benefit for less than 12 months. This compared with 89% in 2009.

Between 2010 and 2012, the proportion of working-age Unemployment Benefit recipients who had received their benefit for:

The decrease between 2010 and 2012 in the number receiving Unemployment Benefits largely reflected the decrease in the number receiving their benefits for two years or less.

Nearly one in two clients granted or cancelling an Unemployment Benefit were aged 18–24

Between 2009/2010 and 2011/2012, around 45% of working-age clients granted an Unemployment Benefit, and the same proportion of those cancelling an Unemployment Benefit, were aged 18–24 (see table UB.6 and table UB.7).

A small number of Unemployment Benefits were granted to non-working-age clients (see table UB.6). Most of those benefits were granted to 16–17 year olds who were supporting dependants.

table UB.6: Ages of clients granted an Unemployment Benefit

Clients age when benefit granted 2007/2008 2008/2009 2009/2010 2010/2011 2011/2012
Unemployment Benefits granted to working-age clients1
18–24 years 22,297 42,426 52,476 49,692 50,787
25–39 years 18,985 32,758 35,307 31,177 30,732
40–49 years 8,550 15,214 16,536 15,526 15,375
50–59 years 4,880 9,307 10,528 10,237 10,503
60–64 years 1,382 2,662 2,936 2,848 2,768
Benefits granted to working-age clients 56,094 102,367 117,783 109,480 110,165
  Unemployment Benefits granted to other clients1
Benefits granted to other clients 93 108 129 92 79
  Unemployment Benefits granted to all clients1
Total benefits granted 56,187 102,475 117,912 109,572 110,244

Note

  1. The number of successful applications for Unemployment Benefits recorded in SWIFTT during years ended June.

table UB.7: Ages of clients cancelling an Unemployment Benefit

Client age when benefit cancelled 2007/2008 2008/2009 2009/2010 2010/2011 2011/2012
Cancellations of Unemployment Benefits by working-age clients1
18–24 years 22,189 26,561 47,735 50,859 52,229
25–39 years 20,902 21,807 32,714 34,860 33,458
40–49 years 9,323 9,581 14,179 16,159 16,142
50–59 years 5,670 5,736 8,702 10,612 11,036
60–64 years 3,156 2,255 2,775 3,293 3,446
Benefits cancelled by working-age clients 61,240 65,940 106,105 115,783 116,311
  Cancellations of Unemployment Benefits by other clients1
Benefits cancelled by other clients 677 454 423 456 345
  Cancellations of Unemployment Benefits by all clients1
Total benefits cancelled 61,917 66,394 106,528 116,239 116,656

Note

  1. The number of cancellations of Unemployment Benefits recorded in SWIFTT during years ended June.

Clients granted an Unemployment Benefit became more likely to have received a main benefit in the previous year

Sixty-one percent of the working-age clients granted Unemployment Benefits in 2011/2012 had received a main benefit in the previous 12 months. This compared with 40% in 2008/2009.

This change largely reflected the impact on work opportunities of changes in economic conditions (recession and the corresponding loss of work opportunities, followed by a slow economic recovery).

Clients cancelling an Unemployment Benefit were less likely to be entering paid work

Forty-four percent of the working-age clients cancelling an Unemployment Benefit in 2011/2012 entered paid work. This compared with around 49% in 2009/2010 and 2010/2011.

This reflected a combination of increased cancellations for non-work reasons and the ongoing slow improvement in economic conditions following the end of the recession.