The Australian Treasurer Josh Frydenberg has declared that the government could not permanently continue to support the unprecedented levels of economic support provided over the past two years.
Speaking with the Australian Industry Group on Feb. 7, seven weeks away from the pre-election budget announcement on March 29, Frydenberg said the federal government’s intervention would not remain ingrained and permanent.
“Continued support at crisis levels would do more economic harm than good,” he said.
Although the country experienced the biggest economic shock since the Great Depression, the Reserve Bank is confident that Australia is progressing toward a jobless rate beginning with a “3” compared with the current 4.2 percent.
“This would be the first time since 1974,” Frydenberg said. “Unlike some other countries, we are seeing a ‘great reshuffle’ rather than a ‘great resignation.’”
An analysis from the Treasury showed that one million-plus worker began new jobs in the three months to November 2021. This figure was nearly 10 percent higher than the average data from the pre-COVID period.
In the past three months, a record number of about 300,000 workers said they quit their jobs to search for better employment opportunities, and this trend happened throughout all industries of the economy.
“Switching jobs allow workers to move up the job ladder for better pay,” Frydenberg said.
“Treasury’s latest analysis using ’single touch payroll' data has shown that workers that moved jobs typically experienced pay increase of between eight and 10 per cent.”
He said the pandemic had resulted in fundamental changes across Australia’s economy and brought about a unique opportunity to evaluate the challenges and opportunities in the country’s productivity.
As such, the Productivity Commission has kicked off its second five-yearly review on productivity under the treasurer’s request.
“With a post-pandemic economy as the backdrop, the PC is being tasked with developing an actionable roadmap to assist governments to make productivity-enhancing reforms,” Frydenberg said.
“It will identify priority sectors for reform, including data and digital innovation and workforce skills.”
The commission expects to finalise the review over the next 12 months.
Meanwhile, the Australian Bureau of Statistics (ABS) also updated its retail report for December 2021 on Feb. 7, adding quarterly spending results.
Although the retail industry saw a 4.4 percent decrease in sales last December in the ABS’s report, economists’ forecasts revealed that the sector grew by 8.1 percent over the quarter.
Also, a large proportion of the quarterly economic growth result comes from household spending. This data will be included in the December quarter national accounts scheduled to publish on March 2.
Overall, ANZ Job Ads dropped by 0.3 percent in January; however, the figures increased sharply on a weekly basis throughout the month, as usually seen in the wake of the holiday period.
This trend occurred despite the high number of Omicron cases reported in the community, which reflected the resilience in the labour market’s demand.
