More than 43,000 Hunter residents, who are taking home almost $24 million a fortnight in JobSeeker payments, stand to suffer when the federal government's coronavirus subsidies wind up in just over two months.
Labor MP Pat Conroy said "the timing could not be worse" for residents in his electorate of Shortland, as well as Newcastle, Paterson and Hunter.
Mr Conroy said 12,239 people were on JobSeeker in Paterson, which equated to $6.73 million a fortnight. Figures showed 11,034 residents were on the unemployment benefit in the seat of Hunter, which was worth $6.07 million every two weeks. In Newcastle,10,986 were on JobSeeker ($6.04 million per fortnight) and in Shortland it was 9168 ($5.04 million per fortnight).
The news comes just days after the Newcastle Herald revealed an estimated 66,500 Hunter workers are poised to lose $100 million a fortnight in JobKeeper payments when the federal government's coronavirus subsidies expire at the end of September.
Newcastle's jobless rate hit 10 per cent in May for the first time in 17 years. The ABS reported the unemployment rate for those aged 15 to 24 as 26.8 per cent.
The JobSeeker payment, formerly known as Newstart, was doubled to around $1100 a fortnight as a support measure during the pandemic.
Prime Minister Scott Morrison has said "there'll be a further phase of support that goes beyond September" but he is not due to issue details of phase two until July 23.
"Where there is the need, then there will continue to be support. And so this is about tailoring a national program to provide support where the support is needed," he said last week.
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Mr Conroy called on the government to stop sending "mixed signals".
"We cannot afford to sit back and allow thousands of additional jobs to be lost," he said.
"People on JobSeeker are more likely to spend the whole payment which in turn supports the economy. That's exactly what we need during this recession.
"The JobSeeker base rate has been inadequate for years and Labor has long been calling for a permanent increase. Almost a million Australians have lost their jobs during the COVID-19 crisis through no fault of their own and they need the full support of the government, not a heartless decision to drop the rate back to $40 per day.
"For too long the government has been sending very mixed signals about both JobSeeker and JobKeeper. This uncertainty is adding to people's deep worries about the recession.
"Given how high unemployment is in the Hunter, the government needs an economic plan to give people hope instead of the current chaos."