Why job recovery post Covid-19 will need a new rule book
NEW data from the Australian Bureau of Statistics on job losses and the economic impacts of the Covid-19 pandemic highlights the need for all governments to rewrite the rule book for economic recovery.
That's the call from the state's peak business organisation, Business NSW, which says the latest unemployment information makes for "hard reading."
Already economists have labelled the Covid-19 crisis the worst economic downturn in 90 years supported by rising joblessness in the grips of national recession.
Through a flattening of the curve and a fall in confirmed Covid-19 cases the Federal Government maintains Australia is moving faster towards a return to normality where all small businesses could reopen.
Australia has not suffered a recession since 1991 and holds the world record for longest uninterrupted economic growth, largely avoiding the crippling impact of the Global Financial Crisis of 2008.
In recent times, however, the number of people employed is down by 6 per cent across Australia, and wages paid fell by 6.7 per cent, ABS statistics show.
NSW performed in line with the national average, but the number of people employed fell by 6.4 per cent and wages by 6.1 per cent in what the Reserve Bank of Australia this week labelled the worst economic downturn since the Great Depression.
Looking ahead to times of economic recovery, Business NSW has called for considered approaches from government in coming months.
"The data, along with in depth Business NSW analysis, indicates that around a quarter of a million jobs have been lost across NSW since the start of the pandemic," Business NSW Mid North Coast Regional Manager, Kellon Beard said.
"These figures suggest that governments will need to change the rulebook when we move into recovery mode to turbo charge the economy and get people back into work," Mr Beard said.
He said the best way to jump-start the economy was to take a chainsaw to regulation, red tape and taxes that hamper innovation, investment and job creation.
"It's also clear that we will need a complete re-think of our Workplace Relations system because pre-Covid-19 rules simply won't support keeping people in work in the years ahead.
"If we want job growth to rebound, we will need to jettison the job killing rules that were allowed to build up over the last three decades when times were good, and we became complacent when it came to driving important workplace relations reforms.
"It also highlights the huge task in front of all tiers of Government once the pandemic is over - the path to recovery is an incredibly steep one - and whilst it seems clear that the Federal and State governments are up for the challenge of implementing substantial reforms to support business growth and jobs, it is less clear that local government is preparing for such a radical change in its attitude toward supporting business.
He said the new data, which uses aggregated Single Touch Payroll information on the number of jobs as well as the wages paid during that period, shows that the true unemployment rate in NSW could already be in double figures.
"This data also confirms what our most recent quarterly business survey was telling us," Mr Beard said.
"That is, jobs in hospitality and tourism-related businesses were the most severely affected in the period since March 14, while some industries such as healthcare enjoyed a temporary spike when compared to February but have since fallen.
"Another worrying trend out of this data is that the younger and older age cohorts experienced the largest impact since 14 March. This likely reflects the profile of hospitality and retail workers and reverses some of the recent increases in participation seen in the 70+ age bracket.
"While the impact that the pandemic and associated shutdowns is having on the economy is clear, it still makes for tough reading."