Australia’s unemployment rate ticked up 0.1% to 5.2% in March 2020, another indicator that the full force of the pandemic will not be felt until April at the earliest. With many businesses locked down in late March and the monthly unemployment survey conducted mid-month, the data lags the reality of the lived experience.
From late March, when the CentreLink queues burgeoned overnight, the unemployment rate spiked enormously. A supplementary ABS survey of 1,059 households conducted in mid-April fond that as many as 1.6 million Australians had lost their incomes in the prior month.
That is, somewhere between 6% and 8% of the population lost their job in a month, in addition to the 5.2% of the population looking for work in March.
It has to be said that the survey size is very small, but if it holds close to true, the unemployment rate may well be around 13%, but is likely to be a little lower, perhaps around 11%.
We can see the official unemployment rate for March below.
Fig. 13
To go straight to the dashboard and take a closer look at the data, click here.
The misleading official data for March is effectively saying, ‘nothing to see here’. That was backed up by other data, including the stable participation rate (66.0%) and the modestly increased underemployment rate (up 0.1% to 8.8%).
So, neither data set is completely reliable, for timing and sample size reasons, but we have to prepare ourselves for an unemployment rate that will rise significantly.
Writing in The Guardian, Greg Jericho outlined the sectors where most of the pain will be experienced. We can see this in the chart below, with the average running to a 6% increase in unemployment, and the agriculture and manufacturing sectors both experiencing smaller falls than the average.
Fig. 14
People without work need more support. That is expensive, and worse, those impacted are unlikely to spend and consume very much. Unemployment is insidious and has to be addressed for the economy to recover. In large part, that is what the JobKeeper program is all about.
