Extract from Deloitte’s weekly economic briefing:
New payroll data indicates that the Australian labor market has fallen from its perch again, after an impressive recovery in the first half of the year.
Released late last week, ABS data revealed that the total number of salaried jobs fell 3.5% between the week ending June 19, before the start of Sydney’s latest lockdown, and August 14. Sadly, these payroll figures are a harbinger of what to expect on Thursday, when monthly ABS labor market data for August is officially released. So far in the pandemic, they have formed a reliable indicator.
This is a big turnaround from just three months ago, when employment exceeded pre-COVID levels, supported by business and consumer confidence.
Sadly, too, the pain will only get worse as data for September and October is revealed in the coming months. Internet job vacancies fell 5.6% in August, with sharp declines in NSW (-9.2%), ACT (-9.0%) and Victoria (-5.9%), and more than half of the country is locked out and will remain so for at least another month.
However, if there is one bright spot to be found, it is that these impacts are concentrated in South East Australia. Elsewhere in the country, where COVID-19 cases have been kept at bay, labor markets have remained relatively healthy, above pre-COVID levels.
In New South Wales, wage employment plummeted 8.5% between June 19 and August 14. That’s more than the state’s 8.3% drop when COVID first hit in April 2020. In terms of level, it’s even worse, due to the fact that employment in June was higher than pre-pandemic levels.
Unsurprisingly, the distributional impacts of the early COVIDs and current lockdowns in New South Wales are broadly similar. Younger and older people, who are more likely to be employed in industries most affected by foreclosure restrictions, have been relatively hardest hit. Likewise, workers in small and medium-sized enterprises are particularly vulnerable.
From an industry perspective, “arts and recreation services” and “accommodation and food services” were again crushed, while “other services”, which include hairdressers, hairdressers, beauticians and church services, and “construction,” this time were more affected due to tighter restrictions. Encouragingly, construction in New South Wales recovered 2.9% in the first two weeks of August after the state’s building ban was lifted.
In the rest of Australia, salaried jobs have also declined everywhere, with the exception of Western Australia, where the total number of jobs increased by 0.5%. Victorian jobs fell 1.6% between June 19 and August 14, but the state’s population was not stranded for various periods in July. As such, Victorian employment is expected to continue to fall.
Nonetheless, despite these declines, salaried jobs remained more than 1% above their starting position before COVID in every state or territory on August 14, except New South Wales.
Australia’s largest states are suffering. Rapidly increasing immunization rates are the light shining on the horizon, as well as the knowledge that economic activity – including jobs – has rebounded fairly quickly from the lockdowns of 2020, and so could do so in the near future. new.