Newly released data from Single Touch Payroll has revealed that 56,000 workers who were previously on JobKeeper have lost their jobs. This is an increase in 16,000 which is up from the figures of 40,000 jobs from the data published two weeks ago.
“The data suggested that up to 40,000 former JobKeeper workers lost employment in the first two weeks following the end of JobKeeper. We now have an extra two weeks of data and across the four weeks, around 56,000 former JobKeeper workers lost employment” said the Treasury secretary.
It is important to note that in regards to the net labour market impact, around 400,000 people move into and out of employment in a normal month and we would expect many of those who lost employment at the end of JobKeeper to regain employment in coming weeks.
The figures, are drawn from estimates from Single Touch Payroll microdata for the fortnight which ended on Sunday 11th April, are well below the predicted 100,000 to 150,000 job losses that the Treasury had previously anticipated. The Commonwealth Bank of Australia had also earlier predicted that there would be up to 110,000 job losses due to the discontinuation of JobKeeper.
The figures appear to confirm that the employment losses associated with the completion of JobKeeper won’t derail the broader labour market recovery.
The early indicators suggest that despite there being job losses associated with the end of the wage subsidy program, many of these workers appear to have found, or already had, other jobs and have benefited from the broader strength of the labour market.
Now that unemployment is currently down to 5.6 percent, the Treasury expects the unemployment rate to reach 5 percent by the end of 2022, and 4.5 percent by 2023–24.
“Early indicators suggest that, while there have been some job losses associated with the end of the program and there may be more in the future,” Dr Kennedy said, “the strength of the broader labour market has meant that many of these individuals are finding jobs” said the Treasury secretary.
New research shows that almost a quarter of Melbourne based businesses were dependent on help from the scheme during its final phase.
Businesses in regional parts of the country fared better than those in the capital cities during the final stage of the $93 billion wage subsidy scheme. Despite this, tourism hotspots such as Byron Bay and Port Douglas remained heavily reliant on the taxpayer-funded assistance right until the end.
Overall, 15 percent of Australia’s 2.4 million businesses accessed JobKeeper in January 2021. Businesses still receiving JobKeeper in January were among the most at risk of going insolvent from the medium to long-term fall out of the pandemic. Craig Dangar notes that there has been an uplift in inquiry from businesses that are looking to explore expansion options to recover revenue lost during the JobKeeper period and an acknowledgment that there will still be structural changes required.
The number of businesses on JobKeeper had dropped significantly since the early months of the scheme – from 40 percent in August 2020 to 15 per cent in January 2020.
During the same period of time, Australia’s unemployment rates have improved since the pandemic peak in July 2020. This demonstrates that ultimately JobKeeper has been a success in maintaining the level of demand for goods and services.
The strict lockdown that Melbourne endured during its second wave of the pandemic meant that 46 percent of the businesses in Victoria were on JobKeeper during July and August last year. This percentage fell from 46 percent to 24 percent during the final phase of the scheme.
In January 2021 Sydney had a total of 17 percent of businesses receiving JobKeeper. 13 percent of Brisbane and Adelaide businesses were on JobKeeper and 11 percent of Perth businesses were still on the scheme during this same timeframe.
13 percent of businesses in non-metropolitan Victoria were on JobKeeper in January 2021. During same timeframe 12 percent of non-metropolitan businesses in Queensland, 11 percent of non-metropolitan businesses in New South Wales and Tasmania were also on JobKeeper during January 2021.
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