Almost 700 Shoalhaven people on JobSeeker had their payments put on hold for failing to meet the reintroduced mutual obligation requirements.
In just three weeks from September 28 to October 19, 688 people had their unemployment benefits suspended after they were found to have breached their mutual obligation requirements.
There are currently around 6500 jobactive and ParentsNext job seekers in the Shoalhaven region.
A spokesperson for the Department of Education, Skills and Employment said the majority of non-compliance for job seekers involved not attending appointments with their employment services provider.
"Outside of Victoria, job seekers may now have their income support payments put on hold, for example, if the job seeker fails to attend a notified job interview without a valid reason," the spokesperson said.
"Job seekers have been advised by the department that they are required to meet mutual obligation requirements and that there are consequences for not meeting them.
"Regular compliance monitoring is conducted by employment services providers in the Shoalhaven and across Australia as part of the Australian Government's Targeted Compliance Framework."
A number of local business owners are frustrated at the difficulty of finding new employees when there are so many people on JobSeeker.
Chance Hanlon from Hanlon Windows said it had been difficult to get people to turn up for interviews.
"I think because JobSeeker is such a generous amount of money it was quite convenient for people to stay home instead of working," he said.
"There are a lot of jobs available in the Shoalhaven, it just seems that people don't want to work and that's sad - we've got jobs going all the time - we're always advertising people to start and look for work with us.
"And we're not looking for people with experience - we are happy to teach, mentor and train. We just want you to turn up and come to work five days a week."
Chance has been looking to grow his business further, but it has been hindered by the lack of employees.
"We've been looking for growth in our business but we haven't been able to get it because we haven't been able to get people to work - that's the sad reality," he said.
"If you can't get people to work, you can't grow."
Kinghorn Motors dealer principal Geoff O'Connell has also had trouble finding staff.
He had six people booked in for an interview for a cleaning job.
"Not one showed up," he said.
"It's very difficult - your trying to run a business and you can imagine the extra pressure on staff trying to keep the place presentable and clean."
"It frustrates you - you hear people talk about how hard it is to get a job - well turn up for your interviews and you might just jag one."