Unemployment and under-employment soar in Queensland during the pandemic but are relatively unchanged in NSW & Victoria

“Australia’s handling of COVID-19 has been widely lauded as one of the world’s best in terms of keeping the virus out of the country and most Australians have lived a largely normal life during the last 18 months – although there has been one nation-wide lockdown in early 2020, a long Victorian lockdown and several shorter lockdowns around the country to deal with.

“Since the pandemic hit Australia in mid-March 2020 the economy has managed to grow by 1.1% over the year to March 2021 when most comparable countries experienced a prolonged contraction. This growth despite the challenge of COVID-19 has under-pinned a fairly strong performance on the employment front – although there have been ‘winners’ and ‘losers’ as well.

“The biggest loser of the pandemic on the employment front has been the tourism-dependent Queensland which has seen total unemployment and under-employment soar from 16.9% of the workforce in the December quarter 2019 to 23.5% in the June quarter 2021 – an increase of 6.6% points.

“The increase in Queensland is fairly evenly spread between an increase in unemployment by 3% points to 11% and an increase in under-employment by 3.7% points to 12.6% over this period. The tourism industry in Queensland has been hard hit by the continuing closure of international borders and the snap border closures whenever there has been a domestic outbreak of COVID-19 has added tremendous uncertainty to any domestic holiday bookings for people from Sydney and Melbourne.

“In contrast to the situation in Queensland it is South Australia which has performed above average over the course of the pandemic. Total unemployment and under-employment in the State has fallen from 23.9% pre-pandemic to 17.4% in the June quarter 2021 – a drop of 6.5% points.

“South Australia’s management of COVID-19 has been ‘top of the class’ with fewer outbreaks than other mainland States and not one day of lockdown for the State so far during 2021. The lesser reliance of South Australia on international tourism than other mainland States has also served the local economy well during a time when international borders have remained closed.

“A partnership between Roy Morgan and UberMedia which tracks the movement of people in locations around Australia shows the Adelaide CBD has tracked at a higher rate of movement than other Capital Cities for most of the pandemic – and every day of the last five months.

“However, despite the good performance of South Australia, the two largest States of NSW and Victoria again have the lowest overall unemployment and under-employment. Before the current lockdown in Sydney there were a total of 16.5% of the workforce in NSW either unemployed or under-employed, an increase of 1.3% points from late 2019 and Victoria’s total unemployment and under-employment was 17.1%, virtually unchanged from pre-pandemic.

“The resilience of NSW and Victoria is impressive as Sydney and Melbourne have experienced longer lockdowns, and far more outbreaks of COVID-19, than any other cities. The importance of the two States to the national economy is under-lined by the fact nearly three-fifths of economic activity (57%) in Australia is generated within NSW and Victoria based on the latest ABS GDP figures.

“What these unemployment estimates do show is that the RBA was right to hold interest rates at a record low of 0.1% this week as there is still far too much unemployment and under-employment in the Australian economy to consider raising interest rates at present.

“The latest Roy Morgan June estimate shows there are now 2.65 million (17.9% of the workforce) Australians who are either unemployed or under-employed – and this figure was before the current three-week long lockdown in Sydney which may well be extended.”