By Leith van Onselen

Above is another cracking segment from last night’s ABC’s The Business examining whether Australia’s unemployment rate has been manipulated by the Government.

According to Andrew Baker from the Centre for Independent Studies (CIS), the Government in 2009 changed the activity test requirements for people on the dole, such that those receiving the Newstart Allowance and Youth Allowance were no longer classified as unemployed. This change, in turn, has lowered the official headline unemployment rate by 0.5%, which means that today’s rate of 5.7% is more like 6.2%.

Indeed, the number of non-job seekers on the Newstart Allowance has soared since 2009 versus job seekers on the Allowance (see below graphic). The CIS says that the number of people on unemployment benefits that are not job seeking has soared by 138% over the past three years.

Interestingly, 2009 was also the time at which the official ABS unemployment rate began to diverge from the unofficial Roy Morgan Research unemployment rate, suggesting there is some substance to the CIS’ claim (see next chart).

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