Extra 1.4 million Australians out of work in wake of COVID-19 pandemic – 3.92 million (27.4% of workforce) now unemployed or under-employed

The COVID-19 Coronavirus pandemic hit the Australian economy hard in mid-March when Australia’s Federal, State and Territory Governments began introducing restrictive social distancing and self-isolation rules to stop the spread of the infectious virus.

The early signs on the new restrictions are good from a public health perspective as the rate of new cases has substantially reduced over since restrictions began to be introduced in mid-March. However, the restrictions have also had a huge impact on the employment situation of many Australians – particularly in customer focused industries such as hospitality and retail businesses that have largely shut-down.

• Unemployment for March as a whole was 1.72 million (12.2%) and under-employment was 1.33 million (9.4%) but this obscures the huge change to the Australian economy that took place in mid-March;
  
• In the first half of March unemployment was 1.02 million (7.3%) with under-employment of 1.14 million (8.2%). A total of 2.16 million (15.6%), an improvement on February as Australia emerged from a summer of devastating bushfires;
  
• However in late March these numbers climbed dramatically as many businesses were forced to shut-down under the new restrictions;
  
• Unemployment for the second half of March jumped a staggering 1.4 million to 2.4 million (16.8%) and under-employment increased 374,000 to 1.52 million (10.6%);
  
• In total a record high 3.92 million (27.4%) of Australians were either unemployed or under-employed and looking for more work in the second half of March;
  
• This is far more Australians looking for work than was the case during the last recession in 1990/91.

Michele Levine, CEO Roy Morgan, says the COVID-19 Coronavirus pandemic is the biggest shock to the Australian economy, and workforce, since World War II – well beyond living memory for the vast majority of Australians:

Latest data for the Roy Morgan employment series for late March shows nearly 2.4 million Australians were unemployed (16.7% of the workforce), with an additional 1.47 million (10.3% of the workforce) now under-employed.

• The workforce in late March was a record high 14,302,000 – comprised of 11,895,000 employed and 2,407,000 unemployed Australians looking for work. The workforce total has increased 411,000 since early March as unemployment has swelled;
  
• The number of Australians in employment in late March plummeted 977,000 from early March to 11,895,000. Full-time employment was down 745,000 to 7,737,000 and part-time employed dropped 232,000 to 4,158,000;
  
• Australians looking for work more than doubled in the second half of March for both full-time and part-time work. The number looking for full-time work increased by 558,000 to 960,000 and the number looking for part-time work was up by 830,000 to 1,447,000;
  
• Roy Morgan’s unemployment figure of 16.8% for late March is now over three times higher than the current (pre-pandemic) ABS estimate for February 2020 of 5.1%. The ABS figure for March is set to be released next Thursday April 16, 2020 and as part of their monthly estimates they must provide data relevant to both early March (pre shut-downs) and late March (post shut-downs).

Roy Morgan Unemployed and ‘Under-employed’* Estimates

*Workforce includes those employed and those looking for work – the unemployed.

This Roy Morgan survey on Australia’s unemployment and ‘under-employed’* is based on weekly face-to-face interviews of 671,486 Australians aged 14 and over between January 2007 and March 2020, and includes 5,950 face-to-face, telephone and online interviews in March 2020 including 2,951 face-to-face interviews in the first half of March until March 15 and 2,999 interviews conducted online and via telephone for the second half after March 15. *The ‘under-employed’ are those people who are in part-time work or freelancers who are looking for more work.

For further information:

Unemployment Data Tables

Roy Morgan Research Employment Estimates (2001-2020)

Roy Morgan Research Unemployment & Under-employment Estimates (2005-2020)

Roy Morgan Research vs ABS Employment Estimates (1992-2020)

ABS Employment Estimates (1992-2020)

ROY MORGAN MEASURES REAL UNEMPLOYMENT IN AUSTRALIA
NOT THE ‘PERCEPTION’ OF UNEMPLOYMENT – JUNE 8, 2012

http://www.roymorgan.com/~/media/Files/Papers/2012/20120603.pdf

The Roy Morgan Unemployment estimate is obtained by surveying an Australia-wide cross section by face-to-face interviews. A person is classified as unemployed if they are looking for work, no matter when. The results are not seasonally adjusted and provide an accurate measure of monthly unemployment estimates in Australia.

The Australian Bureau of Statistics Unemployment estimates are obtained by mostly telephone interviews. Households selected for the ABS Survey are interviewed each month for eight months, with one-eighth of the sample being replaced each month. The first interview is conducted face-to-face. Subsequent interviews are then conducted by telephone.

The ABS classifies a person as unemployed if, when surveyed, they have been actively looking for work in the four weeks up to the end of the reference week and if they were available for work in the reference week.

The ABS classifies a person as employed if, when surveyed, a person worked for one hour or more during the reference week for pay, profit, commission or payment in kind, or even if a person worked for one hour or more without pay in a family business or on a farm.

The Australian Bureau of Statistics Unemployment estimates are also seasonally adjusted.

For these reasons the Australian Bureau of Statistics Unemployment estimates are different from the Roy Morgan Unemployment estimate. Gary Morgan's concerns regarding the ABS Unemployment estimate is clearly outlined in his letter to the Australian Financial Review, which was not published.