People on average salaries receive just a tenth of their earnings if they lose their job and claim Jobseeker’s Allowance (JSA), a new TUC study has revealed.
The value of out-of-work benefits compared to earnings has declined steadily and is lower now than in previous recessions, the union has claimed.
It analysed average earnings, unemployment benefit and JSA rates since 1970 and found that during the 1980s recession, unemployment benefit rates were around 17% of average earnings.
The rate fell to around 14% of earnings in the early 90s recession and in 2008 JSA reached a record low of 10% of average earnings.
Currently £64.30 a week, the UK has one of the lowest out-of-work benefit rates compared to wages in the developed world, according to OECD figures.
The TUC has renewed its call for an increase in JSA to at least £75 a week.
TUC general secretary Brendan Barber said: “Losing your job is always a massive blow. But successive governments have failed to increase unemployment benefits in line with earnings. The result is that people losing their jobs today face a bigger loss in their income than in previous recessions.”
He added: “The view that we need low benefits to encourage people into work makes no sense in a recession. The vast majority of the unemployed are desperate for jobs, and need no encouragement.”