The unemployment rate across Australia has dropped during the latest wave of lockdowns, as a large number of unemployed Australians simply gave up looking for work.
Australia’s unemployment rate dropped from 4.9 percent in June to 4.6 percent in July. These figures have been recorded despite there only being an extra 2,200 extra people becoming employed.
This is the lowest seasonally adjusted unemployment rate since December 2008, when Australia was only just beginning to feel the economic impact of the global financial crisis after a massive mining boom.
According to the Australian Bureau of Statistics (ABS), the major reason unemployment dropped was because the large majority of Australians gave up looking for work when their city was in lockdown, with the participation rate dropping 0.2 percentage points to 66 percent.
The survey was conducted in early to mid-July, capturing the initial effects of Sydney’s current lockdown, but not Melbourne’s latest one.
“The labour market changes in New South Wales between June and July had a large influence on the national figures. There were big falls in New South Wales in both employment (-36,000) and unemployment (-27,000), with the labour force reducing by around 64,000 people. In addition, hours worked in New South Wales fell by 7.0 per cent. These changes offset increases in employment and hours in Victoria,” said the ABS’s Bjorn Jarvis.
The problems associated with Sydney’s unemployment data will begin to show up in next month’s data for Victoria as well.
Sydney’s problems will start showing up in next month’s data for Victoria too. To put it simply, the more lockdowns that are introduced the less money and less revenue a business will have to pay their staff and keep staff employed.
In a sign of what is set to appear in the August data, employment in NSW fell by 36,000, the underemployment rate spiked to 9.3 per cent and the participation rate also fell 1 percentage point to 64.9 percent.
The structure of the Covid-19 disaster payments means that all of these trends will be even more pronounced in the August data. Any workers who are claiming the payment that has not worked at all will be counted as unemployed (and likely not in the labour force, as they will not be actively looking for work), while workers who have had their hours cut will be classed as underemployed.
NSW Workers Waiting For A Covid Test Are Eligible To Claim A $320 Payment
On Sunday 15th August, NSW Premier Gladys Berejiklian confirmed that workers in New South Wales who are waiting for a covid-19 test result are eligible to claim a $320 payment as the state continues to record hundreds of cases a day.
To receive the payment, NSW workers must be 17 years old or older and live in one of the following local government areas (LGAS) that includes;
Bayside, Burwood, Strathfield, Blacktown, Campbelltown, Canterbury-Bankstown, Cumberland, Fairfield, Georges River, Liverpool, Parramatta and the Penrith suburbs of Caddens, Claremont Meadows, Colyton, Erskine Park, Kemps Creek, Kingswood, Mount Vernon, North St Marys, Orchard Hills, Oxley Park, St Clair and St Marys.
Workers must also need to have had a Covid-19 test after Friday 13th August, or if they live in Bayside, Burwood, Strathfield, the test must to have occurred after Monday 16th August.
On top of this, NSW workers need to prove that they were likely to have worked during the period of isolation, and have consequently lost income.
Workers who have lost income as they have needed to care for someone isolating while waiting for a Covid-19 test are also eligible to receive the payments.
Workers who are capable of working from home, who have access to paid sick leave, carers leave or pandemic leave are deemed ineligible to receive the payment.
Furthermore, workers who have been receiving income support from the Australian Government, such as the Covid-19 Disaster Payment, the Pandemic Leave Disaster Payment are ineligible for the payment.
Essential workers who are required to take a test every three days as part of the state’s surveillance testing are also ineligible, as those workers are permitted to work while they wait for test results.
People waiting on rapid antigen tests are also ineligible.
The team at C&D Restructure and Taxation Advisory are here to help. As part of the Vault Group we can offer the full suite of financial products and advice to help you navigate the business landscape. Schedule a meeting here via Calendly or give us a call on 07 36086800.
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