- Between 100,000 to 150,000 JobKeeper recipients could lose their jobs after the subsidy comes to an end on Sunday, Treasury Secretary Steven Kennedy said Tuesday.
- There is a “wide band of uncertainty” around those numbers, Kennedy added.
- Some 1.1 million Australians were signed up to the payroll subsidy through the first three months of 2021.
- Visit Business Insider Australia’s homepage for more stories.
As many as 150,000 Australians could lose their jobs after the JobKeeper wage subsidy winds down on Sunday, a Senate committee has heard, as concerns mount for 1.1 million vulnerable workers who relied on the $90 billion scheme in the first three months of 2021.
Speaking before the Economics Legislation Committee on Wednesday morning, Treasury Secretary Steven Kennedy said between 100,000 and 150,000 JobKeeper recipients “may lose employment at the completion of the program” on March 28, “although there is a wide band of uncertainty around this estimate.”
Treasury states some 400,000 people gain or lose employment in any given month, saying the 150,000-job figure must be taken “in the context of the normal flows into and out of employment.”
The JobKeeper program, launched at the end of March 2020, initially provided eligible businesses with $1,500 per fornight, per employee, with the goal of keeping Australia’s workforce on the books and off unemployment support payments through coronavirus industry shutdowns.
As business conditions improved, and eligibility requirements tightened, the number of recipients plummeted. By the end of 2020, some 1.53 million Australians were receiving the wage subsidy, down from 3.8 million in September.
“Based on data from the month of January, we now estimate that around 1.1 million individuals will be supported by JobKeeper in the March quarter,” Kennedy said.
“This is lower than our MYEFO estimate of 1.3 million individuals. It is also reasonable to assume that as the labour market continues to improve over the March quarter, recipients’ dependence on the program will continue to decline.”
That confidence in Australia’s recovering jobs market, and the slow-starting COVID-19 vaccine rollout, led Federal Treasurer Josh Frydenberg to repeatedly dismiss suggestions of a JobKeeper payment extension past March 28.
But The Age reports Frydenberg will today reveal some 380,000 Victorians still claim the subsidy, even as the state distances itself from the prolonged industry shutdowns of 2020.
JobKeeper’s impending demise may further skew employment numbers, as recipients who have been stood down or receive zero hours a week do not contribute to national unemployment numbers.
“In February, the data tells us that there were around 88,000 workers on zero or very low hours in JobKeeper firms,” Kennedy said.
“We expect that this number will have reduced further by the end of the program, and not all of these individuals would be expected to lose employment,” Kennedy added, while conceding there may be some impact on the underlying employment rate.
“Our view is that the adjustment away from JobKeeper will be manageable, and that employment will continue to increase over the course of this year,” Kennedy said, “although the unemployment rate could rise a little over coming months before resuming its downward trajectory.”
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