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Devastating day as job numbers tumble: PM

Business & finance

Devastating day as job numbers tumble: PM

Prime Minister Scott Morrison has described the latest jobs figures as a ‘tough day for Australia’. WORDS: AAP

The unemployment rate has jumped to 6.2 per cent as nearly 600,000 people lost their jobs because of the coronavirus pandemic.

“This is a tough day for Australia. A very tough day,” Prime Minister Scott Morrison told reporters in Canberra on Thursday.

“It’s terribly shocking although not unanticipated.”

While the rise in April from 5.2 per cent in March was smaller than economists had expected, Treasury has forecast the unemployment rate will rise to 10 per cent in the coming months.

Economists had been expecting an initial rise in the unemployment rate to be over eight per cent, a level not seen since the aftermath of the last recession in the early 1990s.

Treasurer Josh Frydenberg said the significant difference between expectations and reality “reflects the success of the JobKeeper program”.

The $130 billion program allows businesses to keep workers on their books even if they are not operational due to the crisis through a fortnightly payment of $1500.

Treasury has estimated that 850,000 people will be rejoining the workforce once the three-stage plan to lift COVID-19 restrictions that were agreed to by the national cabinet last week are fully implemented.

But Mr Morrison warned people not to get ahead of themselves.

“The task now now is to reopen these businesses to get employees back into their jobs and to do so in a COVID-safe way so that it is sustainable,” he said.

“It’s one thing to close things down, it’s entirely another to open them up again.”

While the unemployment rate was smaller than expectations, Labor described the data as a “frightening” set of figures.

The Australian Bureau of Statistics said 594,300 people lost their job between March and April, comprising 220,500 full-time workers and 373,800 part-timers.

The underemployment rate – which measures employed people seeking additional work – soared by 4.9 per cent to 13.7 per cent.

“This is just the beginning of what is going to be increasingly frightening figures,” Labor’s employment spokesman Brendan O’Connor told reporters.

BIS Oxford Economics chief economist Sarah Hunter agreed it is likely that there will be further falls in employment in May, as the full impact of the crisis plays out.

“But with restrictions being lifted and activity able to gradually begin recovering in all states (the June quarter) should be the trough before the recovery takes hold,” Dr Hunter said,

However, that assumes there is no second wave of infections, which forces lockdown conditions to be reimposed.

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