Australia’s jobless rate tipped to reach double digits

The near doubling in unemployment numbers predicted by the end of June has Treasurer Josh Frydenberg concerned as 800,000 sign up to get financial help.

• US stocks drop after stimulus surge
• Ask the expert: Your health questions answered

The near doubling in unemployment numbers predicted by the end of June has Treasurer Josh Frydenberg concerned.

But he said it was a reflection of the challenges facing Australia as the coronavirus pandemic continues to rage around the world and was confident people would rally together to get people back in jobs when the virus threat was over.

Treasury has predicted unemployment will rise from 5.1 per cent to 10 per cent in the June quarter.

“The unemployment rise is very concerning,” Mr Frydenberg said.

“But it’s also a reflection of the economic challenges that we face.”

More than 800,000 businesses have already registered with the Tax Office for the JobKeeper payment.

Mr Frydenberg said it would be a “Team Australia moment” on the other side of the pandemic when the hundreds of thousands of Australians already out of a job look for roles again.

“We are looking to cut red tape at every opportunity to streamline those opportunities,” Mr Frydenberg said.

“I believe that more jobs will be created on the other side of this crisis.

“I think there will be the recovery phase, Australia will be well-positioned for that.

“But there are certainly some challenges ahead.”

Australian Treasurer Josh Frydenberg has a tough job ahead of him. Picture: AAP

Despite the dire economic consequences the consequences being caused by the strict social distancing measures in place, the Treasurer said easing any prescription now would be ill-advised.

“We cannot get ahead of the medical advice,” Mr Frydenberg said.

“To do so would be dangerous and unrealistic.

“The medical advice has serviced Australia well and Australians expect us to be implementing measures that reflect that advice.

“Over time, once we get to the recovery phase and restrictions are eased, at that point, you will see more people come back into the workforce.”

Australia’s jobless rate is tipped to nearly double to 10 per cent for the June quarter because of the coronavirus pandemic, new Treasury analysis shows.

But Treasury estimates the unemployment figure could have hit 15 per cent without the $130 billion JobKeeper payment.

In February, before the pandemic led to major shutdowns and mass stand-downs of workers, the jobless rate was 5.1 per cent.

Long queues at Centrelink, Marrickville, NSW. Picture: John Feder/The Australian.

“Every arm of government and industry is working to keep Australians in jobs and businesses in business,” he said today.

“The economic shock facing the global economy from the coronavirus is far more significant than what was seen during the global financial crisis.”

When pressed on how long he thinks it will take to get unemployment back down to around 5.1 per cent, he said: “Over time, once we get to the recovery phase and restrictions are eased, at that point you will see more people come back into the workforce.”

But Australia continued to hold its AAA credit rating, one of only 10 countries to do so, Mr Frydenberg said.

Australians will get the first taste of what the pandemic has meant for unemployment when March labour force figures are released on Thursday.

Economists’ forecasts centre on an unemployment rate of 5.4 per cent for March, compared with 5.1 per cent in February.

Predictions range as high as 5.9 per cent, a level not seen since early 2016.

Mr Frydenberg on Sunday warned Australians to expect a significant rise in the unemployment rate alongside a big reduction in the rate of economic growth as a result of the coronavirus crisis.

“That’s a reflection of the queues we have seen outside Centrelink and that is the reflection of the health restrictions that have had a severe economic impact,” he told the ABC’s Insiders television program.

Originally published as Australia’s jobless rate tipped to reach double digits