Analysis of the Australian Bureau of Statistics’ July Labour Force data by free market think tank the Institute of Public Affairs has found that 707,000 Australians are out of work as a result of the economic crisis caused by the COVID-19 lockdown measures. This is the equivalent to approximately three years’ worth of employment growth.
- IPA analysis estimates that 707,000 jobs have been destroyed since March. This is based on the decline in employment (528,000), the increase in the number of those employed but working zero hours for economic reasons (90,000), and the forgone job creation based on the average rate of growth which prevailed prior to March 2020 (89,000).
- Based on the average rate of employment growth which prevailed prior to March 2020, 89,000 Australians would have on net entered employment between March and July. However, due to the lockdowns, there has been a 618,000 net decline in employment, including those categorised as employed but working zero hours for economic reasons.
- 707,000 jobs is approximately the same number of net jobs created in the three years leading up to the beginning of the COVID-19 lockdown measures in March.
- The IPA’s estimate of foregone employment is based on the average employment growth rate between July 2014 and March 2020. July 2014 is the beginning of the current data series for those employed working fewer hours than usual for economic reasons.
Comments attributable to Kurt Wallace, Research Fellow at the Institute of Public Affairs
“Many of the 707,000 Australians who are out of work due to the lockdown measures will struggle to re-join the workforce. There is a high risk of permanent economic and social scarring by depriving thousands of Australians of the dignity of work.”
“Work is central to the Australian way of life. It provides dignity and allows for home ownership, independence, and self-sustaining families and communities.”
“To reverse the destruction of work opportunities, employment growth will need to be maintained at a higher level than prevailed before the crisis. Lockdown measures must be eased where it is safe to do so and governments must slash red and green tape, cut taxes, and engage in serious industrial relations reform to get Australians back into work.”
Note: Employment calculations are based on 6202.0 – Labour Force, Australia, July 2020, released by the Australian Bureau of Statistics last week.