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This paper uses Australian administrative income support data to look at how long people stay off income support when they leave unemployment benefits, what payment type they receive when they come back, and whether this differs for people with mental illness. For 16-24 year olds, mental illness is associated with a higher rate of returns to unemployment benefits, a higher rate of transfers to Disability Support Pension, and a lower rate of transfers to student payments. For 25-54 year olds, mental illness is associated with a lower rate of returns to unemployment benefits, and a much higher rate of transfers to Disability Support Pension. When we estimate the hazard of returning to unemployment benefits, we find that mental illness is associated with a higher probability of returning to unemployment benefits for both 16-24 year olds and 25-54 year olds. This increase in returns to unemployment benefits is found to be larger for youth.
Paul Amores is a doctoral candidate at the Crawford School of Public Policy. His research interests include applied microeconomics and microeconometrics, in the areas of labour, health, and program evaluation. His thesis looks at the role of mental health as a pathway for intergenerational disadvantage.