Australia’s employment rate and economic recovery will be dealt a major blow by lockdowns in Sydney and Melbourne.
The unemployment rate has fallen to 4.9 per cent but the lockdowns are expected to stall the recovery in the labour market.
The latest job figures include a previous two-week lockdown in Victoria, which drove a huge increase in underemployment.
The fresh restrictions in Sydney and Melbourne are expected to bear on next month’s figures.
Business owners hit by closures in the country’s two biggest cities have warned they have no choice but to lay off staff.
The federal government will offer disaster payments of up to $600 a week for workers hit by the lockdowns.
But welfare groups are concerned 800,000 people will fall through the gaps.
Cassandra Goldie from the Australian Council of Social Service wants the financial support package extended to people on JobSeeker, Youth Allowance and other payments.
The JobSeeker unemployment benefit is $315 a week, while Youth Allowance is $256.
Dr Goldie is concerned casual and part-time staff hit by lockdowns could also miss out on support.
Employment Minister Stuart Robert conceded the lockdowns would have an economic impact, but insisted it would be short-lived.
“Because structurally the economy is sound, as soon as lockdowns finish, the economy bounces back,” Mr Robert said on Friday.
“Yes to an impact, no to it being long term.”
Treasurer Josh Frydenberg said the NSW lockdown cost $100 million a day and the impact in Victoria was about the same.
Mr Frydenberg said the coronavirus restrictions would definitely set the economy back.
He is buoyed by the latest jobs figures, saying: “It does show the remarkable resilience of our economy not to mention our job market.”
But the treasurer has conceded they are unlikely to be the last lockdowns this year.