The Productivity Commission says people who lose jobs need extra support.
It says all OECD countries except for Australia and New Zealand have a mandated unemployment insurance scheme.
Commissioner Andrew Sweet told Heather du Plessis-Allan the job-seeker benefit doesn't provide enough income support on its own, and income insurance will help Kiwis find the right job.
"There’s some evidence that if you give them support and let them take a little bit longer, they’ll be able to find a job which is more suitable.
“That is better for them, and also for the economy as a whole.”
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