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Australia prepares for virus job losses
Australia is bracing for a sharp increase in coronavirus-induced job losses, despite national figures showing a reduction in unemployment in February.
Australia prepares for virus job losses
Australia is bracing for a sharp increase in coronavirus-induced job losses, despite national figures showing a reduction in unemployment in February.
The national seasonally adjusted unemployment rate fell by 0.2 per cent to 5.1 in February, but the figures may have been collected before the COVID-19 impact in late February.
Employment Minister Michaelia Cash said there is now a “record number” of people in work, although she believes employment will fall in the coming months.
“We come at this situation from a good economic base. That is reflected in the employment figures for the month of February,” Ms Cash told the media.
ABS chief economist Bruce Hockman said: “The trend unemployment rate remained steady at 5.1 per cent for a third consecutive month.”
“There was no notable impact on February 2020 Labour Force statistics resulting from the recent bushfires or COVID-19. The February reference period was in the first half of the month and pre-dates the notable increases in confirmed cases in Australia of COVID-19.”
The job figures follow Qantas boss Alan Joyce announcing 20,000 workers have been temporarily stood down as international flights have been grounded to a halt.
Westpac chief economist Bill Evans previously predicted unemployment would fall to 7 per cent as the coronavirus continued to impact the Australian economy.
The unemployment rate is now forecast to reach 7 per cent by October 2020 (up from the previous estimate of 5.8 per cent-6.0 per cent) due to the larger negative shocks to the labour intensive sectors such as recreation, tourism, education, renovations and additions, and dwelling construction.
“This lift in the unemployment rate is despite reducing the participation rate from 66.1 per cent to 65.4 per cent as a discouraged worker effect – that is, as workers respond to a deteriorating labour market, the participation rate is likely to decline,” Mr Evans said.
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