- The number of Australians being supported by JobKeeper has fallen by more than 2 million since September, with Treasurer Josh Frydenberg claiming a “remarkable recovery”.
- However, despite half a million businesses leaving the scheme, there are still 1.53 million Australians receiving the wage subsidy.
- Meanwhile, the unions are criticising the government’s refusal to extend the scheme or target support for tourism and aviation as “bad economics”.
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The number of Australians relying on taxpayers to subside their wages has more than halved in the space of just three months.
The latest figures show that by the end of 2020, just 1.53 million Australians were receiving the JobKeeper subsidy well down from 3.6 million in September. The data, published by the Australian Taxation Office (ATO), shows 512,000 businesses have left the scheme and are now covering their entire wage bill alone.
Treasurer Josh Frydenberg leapt on the reduction, claiming it “shows a remarkable recovery in Australia’s labour market.”
“This doesn’t take away from the fact that there are still many people in many regions who are doing it tough, but this latest data from the Australian Taxation Office is another sign the economy is strengthening,” he wrote in an editorial on Monday.
Based on the ATO’s figures, Western Australia and the Northern Territory have proved the most resilient, with JobKeeper subsidies falling by around 70% in each.
In New South Wales, the largest state economy, subsidies have come down 60%, while in Victoria, the only state to have faced a second wave, JobKeeper recipients have fallen by just 44%. For comparison, all other states and territories meanwhile sit above the 60% mark.
The reduction follows a falling unemployment rate, which now sits at 6.6% after peaking in July at 7.4%.
“Of the 1.3 million people who lost their jobs at the start of the crisis or saw their working hours reduced to zero, 90% are now back at work,” Frydenberg wrote.
He notes that the hardest hit sectors – home to some of the loudest voices urging the government to extend support – are also faring far better than they were.
“In sectors like retail, which were hit hard early in the pandemic as health restrictions took effect, around 220,000 people came off JobKeeper in the past three months. In construction, it was 200,000; and in accommodation and food, it was 160,000,” Frydenberg wrote.
The Morrison government has repeatedly rejected calls to extend JobKeeper and has not to date unveiled any targeted supported measures for struggling sectors such as tourism and education.
Decision to cut JobKeeper is being slammed as ‘bad economics’
But while the figures may indicated a dwindling need in the broader economy for fiscal support, they also demonstrate the full extent to which parts of the economy continue to rely on such measures.
To be clear, a not insignificant 1.54 million jobs, or one in every nine, are still being directly propped up by JobKeeper. More Australians still under the age of 35 are being keep in work by the JobMaker hiring credit.
Recovering, yes, but far from in the clear.
With JobKeeper set to expire on April 1, those are jobs that may not necessarily last. The RBA and Treasury both agree that its removal will ‘pause’ any further reduction in unemployment until July, which could see reemerging industries compensate for others that shed workers as a result.
The Australian Council of Trade Unions (ACTU) has been one of the loudest advocates for an extension to JobKeeper arguing that the same figures should compel the government to do more, not less.
“This recovery will be driven by working people spending in local businesses. Cutting supports and driving those workers into unemployment will prolong the recovery, hurt small business and weaken the economy,” ACTU President Michele O’Neil.
“We are living in a crucial recovery period that requires people to spend and to do that people need the certainty that these supports create – to not extend JobKeeper is not only cruel, its bad economics.”
In particular, there are calls for urgent support for sectors that essentially can’t recover until border restrictions end, such as aviation and tourism.
“Aviation workers are desperate for a signal from the Federal Government that it will protect their jobs and extend financial support to their ailing industry,” Transport Worker’s Union (TWU) National Secretary Michael Kaine said.
“The federal government’s own restrictions closing the international borders have shut down part of aviation while ongoing internal border closures are also contributing to the mass stand downs. Aviation workers support any measures that stop the virus spreading but they are crying out for assurances that their jobs will be saved.”
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