Discarded: the Australian women over 50 left to languish in poverty | Business

Deborah Jacobs has tried everything to stay out of unemployment. Bookkeeping, massage, childcare, counselling, even started her own newspaper in the 1990s. And yet, at 63, Jacobs finds herself languishing on unemployment and in poverty – discarded by an economy that refuses to make room for older women.

Before she got into public housing, Jacobs would choose between her medication or electricity bills and got “very good at all different types of instant noodles”, her one meal of the day.

“When I was in hospital they actually gave me an iron infusion to help with my healing because I was so iron deficient,” Jacobs says.

Jacobs is the face of a change in Australian society so stark, one wonders how it seems to have crept up on federal politicians who for years have done little about it.

When the federal budget was handed down on Tuesday, it quickly drew criticism for an absence of policies aimed at helping older women.

Ministers have pointed to the shared benefits of infrastructure spending – “women drive on roads”, said one – but a new job subsidy for those under 35 may actually make life harder for those like Jacobs. The government points out similar subsidies are already in place for older people.

Jacobs’ slide into long-term unemployment repudiates all the ugly stereotypes about people on the jobseeker payment, once called Newstart. Yet even she admits she was once wrong about the myth of so-called “dole bludgers”.

“I’m still staggered at how many older people are on Newstart,” the 63-year-old says.

The change has indeed been staggering. Experts now say Australia’s jobseeker payment has become a “pre-age-pension payment” for older people who find themselves out of work and left stranded in poverty.

Women over 50 made up only 5% of all jobseeker recipients in 2001. Last year, they were one-in-five. Meanwhile, a third of all women on jobseeker aged over 55 had been on the payment for more than five years, up from 13% in 2009.

Deborah Jacobs’ job agency won’t accept her medical certificates, so volunteering is compulsory. ‘When it means you need to take phone calls while you’re in hospital, it’s a bit rough,’ she says. Photograph: Kelly Barnes/The Guardian

When Jacobs, then 50, lost her weekend job at a child contacts service in 2008 – she says she was forced out due to a dispute with management – she felt she still had good prospects.

“I thought that I was on the right track,” Jacobs says. “I never thought I’d be doing things as tough as I’ve done it.”

It’s not like she’d spent long on unemployment payments before. Jacobs left school at year 10 in 1974, took up a secretarial course, and worked mostly as a bookkeeper during the 1970s recession in Queensland. “I was retrenched four times, mainly by being taking over by computers,” she says. “I thought, I’m going to learn computer modules, and so I did it.”

She married and had two children – “I still did lots of stuff like Tupperware and Avon” – and after she escaped a “bad marriage”, she got back on her feet selling ads and writing stories at a local paper in Sydney. Through the 90s, she started her own paper, Engadine’s Locals’ Choice, with her sister, a graphic designer.

Things went sour, but she got back up again. First, she did the books at a bull bar manufacturer, then cobbled together some savings to start her own second-hand furniture shop in Adelaide, where she still lives. Once again, it collided with the changing times.

“The whole bottom fell out of the market with Ikea coming on board and all the flat packs becoming more popular,” Jacobs says. “People wanted new, cheap and available.”

Jacobs has retrained again and again: in childcare and massage. She spent much of the global financial crisis on Austudy learning to be a counsellor.

Now, like so many older women on jobseeker, she’s stuck.

Older women locked out of the workforce

A 2018 Human Rights Commission survey found one in three HR professions would not hire someone above a certain age – and 65% nominated over 50 as “too old”. Other research has found older jobseekers are often seen as “rusty” or “threatening” (because they’re overqualified for entry-level positions). It’s argued older women face an “appearance bar” that makes them “invisible”.

Cassandra Goldie, chief executive of the Australian Council of Social Services (Acoss), says women, and especially single parents, are more likely to take time out of the paid workforce to care for children or elderly parents.

“This creates a gap in their careers and résumés which typically makes it harder to get back into employment, especially full-time positions,” she says.

Those in low-paid roles are more likely to be affected than older professional women with assets, says the age discrimination commissioner, Dr Kay Patterson. In fact, there’s a “great divide” which “seems to be widening,” Patterson adds.

Jacobs took time off to care for her children, but once they reached school age it was back to “bookkeeping full-time in between having my sons at school and all of that”.

Since 2008, the closest she can get to paid work now is through volunteering, which allows her to meet her mutual obligations to Centrelink. She is a veteran of a local mental health program. “I’m generally on the roster to take any after-hours phone calls, and calm them down or refer them onto other agencies,” Jacobs says.

It comes naturally to Jacobs, but there are drawbacks. Her health has deteriorated in the past five years, but her job agency won’t accept her medical certificates, so the volunteering is compulsory. “When it means you need to take phone calls or send emails while you’re hooked up to machines in hospital, it’s a bit rough,” she says.

Other times she’s been passed over for jobs where she volunteers, beaten to the position by someone “working in exactly this same job”. “I was doing the same, voluntarily,” Jacobs says. “I was also 20 years older or more.”

Left to languish in poverty

Despite her ailing health, Jacobs is trapped on jobseeker payment due to decades of policy changes – led by John Howard, but also the Gillard and Abbott governments – which aimed to cut welfare spending and increase workforce participation.

Those goals were achieved. But someone like Jacobs is the collateral damage. She rattles off her ailments: a heart condition, deep vein thrombosis in her legs, osteoarthritis in her knee, and several hernias that have needed operating. Until a recent surgery in July, she carried a stoma bag that was a source of “self-loathing”.

Yet her applications for the disability pension keep getting knocked back. Her rapidly changing health means her conditions are not “stabilised”.

It is a common story. Today, about 40% of people on jobseeker payment have, like Jacobs, medical conditions; in 2007 the figure was 7%.

Jacobs won’t be eligible for the age pension until she’s 67. Other older women, the budget office notes, have been caught up by a change to the single parenting payment that kicks them onto jobseeker payment when their child turns eight.

It wouldn’t be so bad if jobseeker payments weren’t so low, experts say. Australian National University Prof Peter Whiteford points to the situation when the Keating government left office: the gap between what a job seeker and pensioner would receive over a year added up to $1,000. “Now it’s $9,000.”

“The Keating government did a lot to get towards equality between job seekers and pensions,” Whiteford says. “Their assumption was that would continue. It hasn’t.”

The government hasn’t committed to lifting the base rate of jobseeker – meaning it would next year revert to $565 a fortnight, or about $40 a day – but the temporary coronavirus supplement actually lifted Jacobs’ jobseeker payment above the pension and the poverty line.

After the supplement was cut on 25 September, she still gets about $862-a-fortnight, which is only about $80 a fortnight less than the age pension.

Jacobs’ hope now is the government will lift the jobseeker payment to the rate of the pension. Otherwise it’s a long wait to 67.

“The amount of people out there that can’t support their families because they lost their jobs because of Covid, just as qualified as me, if not more, and I’m up against them?” she says. “It just doesn’t seem right.”

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‘Unemployment shock’: will workers hardest hit by the pandemic be left to languish? | Australia news

A year before the pandemic hit, the federal government announced the biggest overhaul of the welfare-to-work system in decades.

The controversial requirement that jobseekers complete 20 applications a month would be scrapped for a more flexible “points-based system” and the most job-ready would be moved on to a government-run digital platform. Job agencies could then focus their efforts on those who most needed help with training, upskilling or just finding jobs.

But the new system wasn’t scheduled to be rolled out until 2022. In the meantime, the government would run a trial in Adelaide and on the NSW north coast.

It’s hard to imagine the Coalition would have made the call to delay the new system if it knew what was coming.

Fast forward 18 months and the nation’s welfare-to-work system is facing its biggest challenge since it was privatised under John Howard in the 1990s, with 1.6 million people on unemployment benefits.

The government has taken three key decisions in response to the pandemic-induced recession.

Mutual obligations – the job-search requirements that people must meet to receive their benefits – were temporarily suspended. At the same time, the government boosted sign-up fees for the private companies and non-profits that run the $1.4bn-a-year jobactive program to shore up the sector.

It means during the pandemic an estimated $360m will flow to providers over six months through these “administration fees”, according to Simone Casey, a policy analyst at Per Capita.

Conversely, and in a move that has angered the industry, the government expanded the digital trial by diverting about 400,000 new jobseekers from across the country to the new online service.

These people will not be connected with a job agency, depriving the sector of an even larger windfall of sign-up fees and bonuses for getting people into work.

The decision is a tentative step closer to the 2022 model, allowing many people to go about their job search themselves.

“The jobactive system was designed for low unemployment,” Casey says. “It was not designed for the unemployment shock we’ve got.”

Before the pandemic, the average consultant to jobseeker ratio was 148, according to one report, up from 94 about a decade ago.

With nearly 1 million more now on benefits, the fear is that providers will ramp up what research has already accused them of doing: “creaming” and “parking”.

This sees consultants focus on those who are easy to place into employment, triggering a fee, while those with more bleak prospects are left to languish.

“The advantage of the new model is that jobseekers who can self-service online will be left alone by jobactive agencies,” Casey says.

“Only the people who need specific support or who have more complex needs will go to an agency.”

The reason why some jobseekers might want to be “left alone”, as Casey puts it, is that welfare campaigners have long argued the jobactive system is punitive.

While some report positive experiences, others say they have been ignored, bullied, or pushed into “demeaning” or “condescending” personal development courses – sometimes run by the same company – or positions that don’t align with their goals.

Some who have found a job themselves have been hassled to provide payslips so the consultant can claim a fee anyway.

Kristin O’Connell, of the Australian Unemployed Workers Union (AUWU), agrees there are positives to shifting some people away from job agencies.

But she has concerns about a “one-size fits all” digital model that replaces meetings with a jobactive consultant for online tools and a contact centre.

“We don’t think there should be no support for jobseekers,” O’Connell says. “We think jobseekers should be able to access the support they want.

“Give people a choice about whether they need something. And when they decide they do, make sure that support is available.”

For the first time since the Keating government introduced “mutual obligations”, the system during Covid has at least been designed to give jobseekers some choice.

Swelling ranks of jobseekers have filled out a questionnaire that either places them in the online employment services system or with a jobactive provider. Those who want the extra help can “opt out” of the digital program.

With welfare penalties suspended, the government has guaranteed the 1.6 million people on the jobseeker payment – up from 700,000 pre-pandemic – that their Covid-boosted benefits will drop into their bank accounts every fortnight regardless of whether they finish enough job applications or attend meetings with a provider.

Because providers are unable to suspend payments during the pandemic, in some cases, it has created more of a voluntary relationship between jobseekers and their consultants.

Still, in other cases, O’Connell says consultants have threatened to cut off the benefits of new jobseekers unless they agree to attend a meeting. These sign-up meetings trigger a payment for the provider.

Tellingly, there were still 1,301 complaints about jobactive providers between 20 March and 31 July despite the relaxed rules.

While the AUWU has called for a “mutual obligations strike” and wants them abolished, the government is likely to revive the penalties when the pandemic eases.

And it has confirmed the more flexible “points-based” mutual obligations system still won’t be rolled out until 2022.

Ideologically, the government’s view is that mutual obligations incentivise people to get back into work, though international research has disputed this and current data suggests employers are already being flooded with applications.

In the same vein, it plans to reduce welfare benefits that were lifted during the pandemic, with the first $300-a-fortnight reduction due on 25 September.

The Greens senator Rachel Siewert, a vocal critic of the welfare penalties regime, is disappointed the government is not signalling its plans for mutual obligations.

That is because the system temporarily stopped welfare payments more than 2m times in 2018-19, incorrectly on many occasions. This hasn’t happened at all during the crisis.

“It depends where you are in the country, but you’re going to have a group of people that have potentially significant mental health issues [due to the pandemic],” Siewert says.

“If you look at what works … you provide wraparound, targeted support. The people that are supporting you are not also the compliance person.”

The employment services sector argues Australia spends less than the OECD average on labour market programs. Even critics agree more funding would be welcome if better directed, though they note Australia is one of the few countries where the funding goes to private companies.


Analysis of government tenders since 2012 suggests Max Solutions, the largest jobactive provider, has reaped an estimated $1.6bn in contracts across multiple welfare-to-work programs.

Another, APM, has raked in about $980m, while Sarina Russo has won more than $600m in contracts.

The figures demonstrate revenue, not profit, and there is no suggestion the payments are anything other than legitimate.

But there is money to be made. Maximus Inc, Max Solution’s publicly listed international parent company, posted a $240m profit in 2019. Separately, it has previously told shareholders 10% of its revenue came from the Australian government.

In a June financial update, Maximus told investors an “improved outlook in our Australia operations” was among the reasons for “better than expected” earnings.

That was before the government’s decision last month to refer many jobseekers on to the digital platform rather than jobactive.

Although Casey would like the government to move faster on its funding reforms, there is at least a sense that the gravy train could be slowing down.

Sally Sinclair, chief executive of the National Employment Services Association, disputes that providers want more jobseekers on their books to bolster their bottom lines.

“Our concerns are that half the newly unemployed are in an online employment service which was being trialled,” she says when asked about the decision to no longer refer some jobseekers to the agencies.

“We don’t know what will happen to the people in that service, how they are getting the necessary support they might need.”

Sinclair says talk of a windfall through sign-up fees is overstated, arguing the funding payments only “barely cover what providers have to deliver”.

Most of the sector’s funding “outcome fees” paid for getting people into work or training, she says. “This is not about administration fees. It’s about making sure people are supported and assisted.”

For the jobseekers the AUWU represents, it’s about more than that. “People would like flexibility,” O’Connell says. “And support that is available to them when they want it, but not forced upon them.”

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