Victorian lockdown hits hiring recovery

Victoria has gone from being one of the strongest states where businesses were seeking to hire staff to the weakest as a result of its latest coronavirus restrictions.

Department of Employment data shows advertising on the internet for jobs in Victoria fell 6.5 per cent in July, to stand over 40 per cent down on the year.

It could be even worse when the August figures are released.

The report notes that the COVID-19 restrictions in Victoria have been progressively rolled out since July 8.

“While a downturn in Victorian recruitment activity was observed in the July … data, August data may prove more reflective of the full downturn,” it says.

Nationwide jobs ads rose 8.9 per cent in July, building on the rise since hitting a record low in April as states and territories emerged from the first round of COVID-19 restrictions when the virus was thought to have been suppressed.

But ads remain 23.3 per cent down compared with July 2019.

Sales workers were the most in demand in July among the eight occupational groups monitored by the department, with ads rising 16.7 per cent.

The harsh level four lockdown in Victoria is expected to delay the overall economic recovery in Australia, as the state accounts for 25 per cent of national output.

“That will offset the ongoing recovery we expect to be unfolding in other states as they continue to reopen, albeit at varying speeds,” Westpac chief economist Bill Evans said. 

The Westpac-Melbourne Institute leading index, which indicates the likely pace of economic activity three to nine months into the future, remains in deep negative territory consistent with a recession.

“However, (the index) appears to have bottomed out in April … and without the recent disaster in Victoria, it seemed that the June quarter would have marked the low point in the growth cycle,” Mr Evans said.

He now expects growth will be flat in the September quarter before growing by 2.8 per cent in the December quarter on the assumption Victoria moves through stage four to stage two and other states avoid a second wave.

Against this gloomy near-term outlook, a leading business group is urging the national cabinet to set a new roadmap for when interstate border restrictions will be eased.

The Australian Chamber of Commerce and Industry third COVID business conditions survey found interstate and international travel restrictions are having a significant impact on more than half of Australian businesses.

“Interstate travel restrictions are having the biggest impact,” ACCI chief economist Ross Lambie said.

“Businesses need clarity so they can plan ahead, particularly towards the Christmas season when they would normally put on more staff to meet increased demand.”

Prime Minister Scott Morrison expressed his frustration at the “incredibly disruptive” impact state border closures are having.

He acknowledged state premiers were trying to protect their own citizens from coronavirus but said more work was needed to make the restrictions more workable.

“I understand what they’re seeking to do but it’s important that all premiers act on the basis of transparent medical advice,” he told ABC News Breakfast.

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