Australia ‘losing USD2.5B in a week’ in virus shutdown

SYDNEY (AFP) – Australia’s economy is losing USD2.5 billion every week its virus shutdown continues, with GDP forecast to plunge 10 per cent in the June quarter, according to figures announced yesterday.

The country has enjoyed success in curbing the spread of COVID-19, with new daily cases slowing to single digits or zero across most regions.

But Treasurer Josh Frydenberg said measures to curb coronavirus were dealing a heavy blow to the economy, with GDP forecast to fall 10 per cent in the June quarter.

“For every extra week that the current restrictions remain in place, the Treasury estimates that close to USD4 billion will be reduced in economic activity, from a combination of… reduced workforce participation, reduced productivity, and reduced consumption,” he said.

The estimate came as the Australian Bureau of Statistics (ABS) reported a 7.5 per cent drop in jobs – which it said was equivalent to about 700,000 workers out of an active workforce of some 13 million – in the five weeks to April 18.

A third of workers in the worst-affected hotel and hospitality industries lost their jobs, along with 27 per cent of people in the arts and recreation sectors.

The Treasury has previously estimated the unemployment rate will double to 10 per cent by the middle of the year because of the coronavirus shutdowns, leaving about 1.4 million people out of work.

The ABS also reported that 31 per cent of households nationwide had seen their finances worsen. Frydenberg said the figures showed Australia “must get people back into jobs, and we must get people back at work” but the country had only met 11 of the 15 health conditions for lifting restrictions – though work was ongoing to fast-track the remaining four.

Two cranes are reflected on the side of a high-rise building in Melbourne. Australia’s economy is losing USD2.5 billion every week its virus shutdown continues, while a million workers have already lost their jobs in the crisis. PHOTO: AFP