$35 A DAY NOT ENOUGH!

People in the prime of their working lives make up the largest share of those on unemployment benefits, a trend unions and social services groups say reflects greater insecurities at work.

While older workers face a greater risk of long-term unemployment, official figures show those aged 25 to 34 and 35 to 44 are the two biggest groups to receive Newstart payments. Between them, these two groups account for nearly half of all Newstart recipients. The next largest group of Newstart recipients are aged between 45 and 54.

The chief executive of the Australian Council of Social Service (ACOSS), Cassandra Goldie, said the extent of Newstart payments to people in their 30s and 40s was affected by the growing prevalence of irregular and casual work, which was being experienced by workers of all ages.

''The idea that there's a job for life is no longer the reality in Australia,'' Dr Goldie said. ''People can lose their job and this can happen in the prime of your working life, and then it becomes really hard. Often there's a need to retrain … and if you don't have the financial resources to do that you can get really stuck.''

This week government payments to some single parents were cut by $115 a week, as part of a group of cuts affecting tens of thousands of people.

The Minister for Families, Jenny Macklin, sparked an outcry when she claimed she could live on the $35-a-day Newstart allowance. The comment was later omitted from the transcript of the press conference where she made the remarks.

The president of the Australian Council of Trade Unions (ACTU), Ged Kearney, said there were anecdotal reports of many people who had finished studying or training struggling to find full-time work, leading to a cycle of casual or irregular employment.

''What we've seen is people are caught in short-term work or casual labour, '' she said. ''This certainly is a story we're hearing from a lot of people in their late 20s and 30s.''

Although people in their prime working years account for the highest share of Newstart benefits, those over 55 have a higher risk of long-term unemployment - being jobless for a year or more.

Newstart and other payments are indexed twice yearly with the CPI, meaning that they are linked to increases in prices, rather than wages. That means they fall behind increases in community living standards. They have not been increased since 1994. While the CPI rose by 17% between 2005 and 2011, average wages rose by 23%.

Newstart is less than half of the minimum wage in Australia. While minimum wage is $606, Newstart is $246 – 40% of minimum wage. Even taking account of income tax, a single unemployed person would double their disposable income if they got a job at the minimum wage. So there is scope to increase it without eroding work incentives.