The de facto dole

This morning I came across this graph which clearly shows numbers unemployed dropping from around 135,000 in 1999 to around 80,000 by 2008.




Yet the following tables show that in 1999 148,755 people were receiving the unemployment benefit and the number dropped to 23,273 by 2008.



So how are sixty-odd thousand unemployed getting by?

Maybe

1/ Unemployed people in 2008 are largely short-term unemployed and have no need of or do not qualify for the dole.
2/ Unemployed people in 2008 are relying on other forms of income, perhaps an employed partner.
3/ Unemployed people in 2008 are relying on benefits other than the dole i.e. sickness and invalid benefits

I doubt that 1/ is the sole answer because then you would expect those left on the dole to be long-term employed only and that just isn't the case.

2/ may be right but that would require a cultural change.

So let's consider 3/

In September 1999 there were 83,635 people on either a sickness or invalid benefit. By September 2008 the number had climbed to 131,826. 48,000 more. Not far off the number we are looking for.

The Labour government constantly denied that unemployed people were moved onto other benefits. Strictly speaking that may be true. But the beneficiary pool is ever-changing; people come and go and have repeated spells on welfare. When coming onto or back onto a benefit, I would suggest fewer and fewer were put onto the dole.

MSD data shows that 72 percent of the working aged clients granted a sickness benefit in 2006/2007 had received some sort of benefit in the previous four years. And 69% of people granted an invalid benefit had transferred from another benefit or district.

I will repeat how the OECD describes incapacity benefits. They represent the medicalisation of labour market problems.