Australia’s Job Market Divides Into Three as Covid Hinders Recovery By Sybilla Gross August 12, 2020, 5:00 AM GMT+10 Updated on August 12, 2020, 2:02 PM GMT+10 Australia is showing increasing signs of...

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Australia’s Job Market Divides Into Three as Covid Hinders Recovery By Sybilla Gross August 12, 2020, 5:00 AM GMT+10 Updated on August 12, 2020, 2:02 PM GMT+10 Australia is showing increasing signs of a three-speed labor market, with real-time data underscoring the importance of successful virus containment so firms can reopen with confidence and employees can return to work. After an almost uniform pickup from April lows amid the national lockdown, payrolls in Victoria, New South Wales and Western Australia diverged in late June. Employment in Victoria began to collapse as surging infections forced the reintroduction of tough restrictions; New South Wales flatlined as Sydney contended with outbreaks; and Western Australia, virus-free and sealed off, kept improving. “There’s an emerging three-speed dynamic in Australia’s labor market, and economy more broadly,” said James McIntyre, an economist with Bloomberg Economics in Sydney. “Australian data from July onward will be affected by these cross-currents until successful containment is achieved in the virus states.” Divergent Paths Payroll data reveal an uneven job market recovery across the states Sources: Australian Bureau of Statistics, Bloomberg The outcomes underscore central bank Governor Philip Lowe’s warning that the recovery depends on a vaccine for Covid-19, which would allow Australians to feel confident about their health. Short of that, states like New South Wales that are constantly battling virus hotspots will struggle with fragile sentiment that discourages firms from hiring and households from spending. Australian consumer confidence plunged in August, data showed Wednesday, with Melbourne’s tougher lockdown to counter spiraling inflections damaging the state’s outlook. From there, a wave of uncertainty swept across the rest of the country, with New South Wales particularly hard hit. The Westpac Banking Corp. survey also showed unemployment expectations jumped 14.6%. “Consumers across the nation appear to have been rattled by the developments in Victoria and fear that other states may also succumb to the ‘second wave’ outbreak,” said Bill Evans, chief economist at Westpac. Separate government data today showed wage growth in the second quarter slowed to the weakest pace in the 27-year history of the series. At present, Western Australia, Queensland, South Australia, Tasmania and the Northern Territory have the virus under control. By shutting their borders to the rest of the country, they have managed to create economic bubbles that allowed them to reopen bars and other services. That’s sparked a revival in job advertisements for sectors like dental, personal care and beauty services, said Callam Pickering, an economist at global jobs website Indeed Inc. In Western Australia, even the most-affected sectors from the virus -- like arts, food and accommodation -- are nearly back to pre-Covid levels. Sector Strength Payroll numbers from different segments of Western Australian job market Sources: Australian Bureau of Statistics NOTE: Does not show all sectors Yet in New South Wales, where another outbreak remains a realistic threat -- particularly with hard-hit Victoria on its southern border -- the upturn in ads and hiring is milder. “We share a border with that state and we’ve had an increased rate of transmission, albeit very minor,” said Matthew Gribble, managing director for Australia at recruitment agency Michael Page Intl Plc in Sydney. “But all of those sort of things chip away at confidence a little bit.” Western Australia is finding that remoteness isn’t its only advantage: It’s also a resource hub. With the price of iron ore surging above $100 a ton on Chinese demand, Western Australia is enjoying a windfall that’s encouraging miners to hire. “Mining has also continued to buoy the state’s job market,” Indeed’s Pickering said. “The recovery is continuing for everyone else, but we’re basically back at stage 1 for Victoria.” https://www.bloomberg.com/news/articles/2020-08-11/australia-s-job-market-divides-into-3-as-covid-hinders-recovery
Answered 6 days AfterJan 20, 2021HC1072

Answer To: Australia’s Job Market Divides Into Three as Covid Hinders Recovery By Sybilla Gross August 12,...

Moumita answered on Jan 27 2021
133 Votes
MACROECONOMIC ANALYSIS
Table of Contents
GDP and Unemployment    3
Fiscal Policy    4
Monetary Policy    5
Findings, Conclusion and Recommendations    6
Reference    7
GDP and Unemployment
a) The GDP of Australia is divided into three major parts. One among them is the service sector which contributes a lion share of the GDP (70 %). The
other sectors contributing to GDP are the agricultural (2%).and the industrial sector (25%). The employment rate of the community has fallen drastically over the past few months. The pandemic situation has resulted in a loss of jobs as companies and organisations try to keep up with increasing costs and low or no sales. In recent year, the GDP graph of Australian mounted to -4.2% (Jacobs, 2020). This is a 6% drop in the country's real GDP compared to the previous year's figures. The country's economy is mainly driven by government and organisational spending, whereas low household spending and consumer sectors struggle. Therefore, it is important for the country to develop a stable mode of economic viability.
Figure 1: Snapshot of GDP in Australia
(Source: RBA, 2020)
b) The unemployment rate of the country has increased significantly in the pandemic condition. The pandemic has led to low or no business for most of the industry and other sectors. The Australian economy is dependent on various service sectors which were hampered by the pandemic. The hospitality industry was also hampered significantly in the current condition. The business organisation under the pressure of various components and m factors had to reduce the cost to serve in the business. Thus unemployment increased significantly. Organisations and companies had to cut loose of their employees to save the business. The effect of unemployment in the county was catastrophic. This led to the development of policy by the government known as job seekers payment. The policy was developed with the idea of supporting organisations incurring heavy loss (Jacobs, 2020). The government announced a payment weekly for such organisations to keep up their cots. The schemes' main objective was to enable and support the organisation so that there is no need for sacking the employees to maintain their cost.
The government's support enabled such organisations and supported them financially to overcome the situation (Browne‐Yung et al., 2019). The government directly expanded the payment up to march 2021. The strategy is direct towards the recovery of the economy by injecting monetary esprit to the economy. The unemployment rate had its effect on the GDP which fell by about an average and record low in the decade, the struggling phase of the economy through improved and is projected to revive and show an increase by 3% in the latter half of 2021. This will allow the employment rate to increase. The employment rate has increased significantly, and there is a continuous decrease in the unemployment rate. The working hours of the county have also increased drastically over the period of the last three months.
Fiscal Policy
a) The fiscal policy taken by the Australian government has supported various objectives from time to time. In this case, the fiscal policy is directed to support the economic conduction during the COVID-19 pandemic. The whole system was shocked by the private demand and...
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