Australia’s Effective Unemployment to Rise to 13% by Year End
Arslan Butt • 1 min read
The unemployment rate in Australia is expected to rise further as a result of the fresh outbreak of cases and the ensuing lockdown in the state of Victoria. According to latest estimates by the Treasury, effective unemployment could rise to 13% by the end of 2020 after having fallen to 9.8% in July from a high of 14.4% in April when the whole country was in lockdown mode.
Effective unemployment not only consists of people who are out of jobs but also includes those who are technically employed as a result of stimulus measures like the government’s JobKeeper program but have not worked any number of hours. The official jobless rate in Australia stood at 7.5% during July, and takes into consideration only those people who are out of work.
According to official figures, more than 1 million Australians were jobless and looking for work as of July, while 165k remained technically employed due to the JobKeeper program. The government has extended this scheme until March 2021 but there is no clarity yet on how businesses in the country and the economy will be affected once the effect of the stimulus measures fade and the global recession makes its impact.
Even though the figures suggest a rise in unemployment in the coming months, Treasurer Josh Frydenberg maintains some optimism that economic recovery after lockdowns are eased could help improve the situation. According to him, “Treasury estimates show that nearly 700,000 people have gained effective employment since April recovering more than half of the jobs lost or those who were stood down on zero hours at the start of the crisis. There is still a long way to go through this crisis and high frequency data is showing signs that the jobs recovery may be slowing as state border closures have been tightened.”