CEOs urge Victorians to get the jab amid new lockdown

As Victoria enters its fourth Covid lockdown, business leaders say higher vaccination rates are the only answer.

People wearing face masks boarding and disembarking a tram in Melbourne on Thursday. Picture: Getty Images

Business leaders are calling for the acceleration of the Covid-19 vaccination program as a national priority as Victoria enters its fourth lockdown to lift the pace of economic recovery.

After a seven-day lockdown was declared across Victoria, National Australia Bank chief executive Ross McEwan backed the state government’s move to speed up the vaccine rollout by lowering the minimum vaccine age requirement from 50 to 40.

“Getting more people vaccinated is going to be crucial to our recovery,” he said.

“I’ve had my first dose and I’m pleased to see it will now be available for people over the age of 40 in Victoria.”

Mr McEwan said NAB’s branches would remain open statewide and that although the lockdown was tough, it would protect lives.

“Today is a tough day for Victorians, but throughout the pandemic communities and business owners have shown how resilient they are,” he said.

“As difficult as this is, these measures are being introduced to protect lives.

“Australia’s economy has recovered much faster than anyone expected. However, this is another reminder that challenges do remain and the recovery will not always be smooth.”

The nation’s retail sector is already counting the cost of Victoria’s sudden seven-day lockdown, triggered by the latest outbreak of Covid-19, warning the enforced shutdown of businesses and home isolation will cost more than $1 billion and comes at a time when the safety net of the federal government’s JobKeeper scheme has been removed.

NAB chief executive Ross McEwan. Picture: Aaron Francis/The Australian

A spokeswoman for Wesfarmers, whose key businesses Bunnings, Officeworks, Kmart and Target have tens of thousands of employees in Victoria and headquarters in Melbourne, said sudden lockdowns would wreak havoc on the economy.

“These snap lockdowns cause enormous harm to the community and the economy and it goes without saying that everything should be focused on addressing the key areas of vulnerability that have given rise to them, for example hotel quarantine,” he said.

Ramsay Healthcare chief executive Craig McNally joined Mr McEwan in urging everyone who was eligible to get a Covid-19 vaccine.

“There’s a confidence about the future, but it doesn’t mean things are back to normal,” Mr McNally said.

“I think the vaccination rates have a significant impact on getting back to normal for all the obvious reasons, but also in terms of staff vaccination as well.”

Fred Harrison, the chief executive and major shareholder of one of the nation’s biggest independent supermarket chains, Ritchies, said there were concerns the lockdown in Victoria would need to be extended but his business was ­prepared for the worst. “I think the experience we have had through the three lockdowns have got us in good stead,” he said.

“But I think there is a bit of an expectation among consumers that it will go for longer than seven days. That is the feeling we are getting from what the customers are saying to our staff, and they are digging a bit deeper in terms of buying today.”

Mr Harrison said he was concerned about how this latest shutdown would dent consumer and business confidence.

“If you are a general retailer this is debilitating, and you wonder how many more random lockdowns can occur without really seeing more and more business closing,” he said.

Australian Retailers Association chief executive Paul Zahra said the lockdown was a devastating blow for retailers, costing more than $1bn in lost trade and highlighting the ongoing risks of the pandemic.

“We support the Victorian government in their response to keep the community safe, but we can’t ignore the significant impact this lockdown will have on retailers, the Melbourne CBD and small businesses in particular,” Mr Zahra said.

“Victorians have been to hell and back over the past year or so, and just when we thought the worst of Covid was behind us, it reared its head again mid-year. Businesses no longer have JobKeeper support payments available to them and Victorian small businesses in particular will be under significant stress – this is a huge blow to their confidence.”

Some businesses have committed to pay employees who are stood down for the week.

Crown Resorts, operator of the state’s largest employer, Crown Melbourne, said it would continue offering hotel accommodation but close its gaming, retail, food and drink facilities – except for some takeaway businesses – and continue paying staff.

“Crown Melbourne will pay employees’ rostered hours and salaries (as applicable) over this period,” the company said.

National Retail Association CEO Dominique Lamb said Victorian retailers hoped the new round of restrictions would be short and successful, but many were nervous, given the lack of assistance measures.

“The pandemic has wreaked havoc across the entire country over the last 12 months, but none more so than Victoria,” Ms Lamb said.

“Foot traffic across major shopping precincts worsens with each lockdown.

“The Melbourne CBD has tracked consistently at 40 per cent below pre-pandemic levels.”

A large line up of cars were at the Melton COVID-19 testing site as Melbourne approaches a lockdown from another breakout. Thursday, May 27, 2021. Picture: David Crosling

Economists were more circumspect in their evaluations of the lockdown’s impact.

NAB chief economist Alan Oster said the economic impacts of a snap seven-day lockdown would be small on an economy-wide scale, but noticeable in pockets of the economy.

“You might knock 1 per cent off Victoria’s GDP in the quarter, and Victoria is 30 per cent of the Australian economy, so overall you get 0.2 per cent, maybe 0.3 off GDP in that quarter,” he said.

“It will be painful for some people, particularly for small business, but if you had to guess across Australia you wouldn’t guess big numbers. Beyond that, I believe people are just making up numbers.”

Melbourne-based Mr Oster said the impact of the lockdown on consumer and business sentiment was harder to quantify, but probably not be as large as in previous lockdowns in Victoria.

“I just went down to the local Woolworths and didn’t have any problem buying toilet paper,” he said.

“People are a little more resilient and getting used to it.”

AMP Capital chief economist Shane Oliver also said a short lockdown would not affect the economy much.

“The history of economic lockdowns in Australia is that they are relatively minor,” he said.

“We have seen several over the last six months. We’ve had quite a few, and while they are horrible while they happen, the economic impact is quite minor.

“The economic indicators perk up once they are over.

“There was talk about last year’s lockdown in Victoria costing $10bn to $15bn. I’d say this cost will be probably less than $1bn – If it is just seven days, probably only a few hundred million in economic cost.”

The property industry is expecting a swift drop and then a bounce-back in Melbourne’s roaring auction market.

REA executive director, economic research, Cameron Kusher warned of the short-term fallout.

“This week in Victoria over 1330 auctions are scheduled to take place, making it the second-biggest week for auctions in 2021,” Mr Kusher said.

“Following the Victorian government’s announcement of a snap seven-day lockdown, many of these auctions will move online or be postponed. It’s likely we will see a big drop in sales over the coming week followed by a strong rebound as we’ve seen previously.”

Much hinges on whether work sites stay open.

Property Council of Australia Victorian executive director Danni Hunter said the property and construction industry wanted to keep running and “can continue to operate safely and responsibly, to keep Victorians in work and projects from coming to a standstill”.

The Victorian government has kept the construction sector open during the seven-day lockdown. But Ms Hunter said the response would “inevitably impact businesses and the community and would set back Victoria’s economic recovery”.

Ms Hunter called on the government to work with the property and construction industry.