Tuesday, July 16, 2013

Percentage of working age population on a benefit over the last decade

The four main benefits all came to an end yesterday. So the data is worth recording for posterity.

Below I've scanned MSD's graphs for each expressed as a percentage of the working age population (18-64) over the past decade. Beneath I've added some observations.

The invalid benefit axis has a different scale  so the improvement looks better than it is.

The overall dependency has dropped from around 12.8 percent to 10.7 percent. Still over one in ten people on welfare.

This represents a reduction in absolute numbers. But because the numbers have held up in the invalid and domestic purposes benefits - where people typically stay dependent for long periods - the degree of dependency in terms of longevity is still very high. To explain that better, look at the unemployment benefit. The numbers plummeted. But those year-end snapshot totals  represent people who will typically be on a benefit for 7-8 months. Whereas the DPB numbers represent people who will be on a benefit for 7-8 years.

To their credit, the government is now addressing this facet by focussing efforts on those who fit a long-termer profile (barring carer's of invalids, terminally ill, chronically disabled, etc).

The improving economy during Labour's stint resulted in a lot of people coming off the unemployment benefit - 4 percent dropped to 0.7 percent. And that was great.

But the DPB was far less amenable to the positive effect, with the percentage dropping from 4.5 to 3.7 percent. If 3.7 percent is the best a strong economy can achieve then it's clear other factors are at play.

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