Australia Says Victoria Jobless Surges as Lockdown Cuts Spending
The coronavirus lockdown in Australia’s second-most populous state caused an immediate slump in consumer spending and a surge in job losses this month, the federal government said.
The number of Victorians receiving unemployment benefits has risen by 27,600 since June 26, a 7.2% increase, and more than half of that total was recorded in the three weeks ended Aug. 21, the federal Treasury said Sunday in an e-mailed statement. The stateimposed severe restrictions on Aug. 2 as the pace of Covid-19 infections climbed, with the latest wave peaking Aug. 4 at 687 new cases.
The Reserve Bank of Australia said this month itexpects the economy’s recovery to be slower due to the “major impact” of the lockdown in Victoria, which accounts for about 25% of the nation’s GDP. The RBA resumed buying government bonds on Aug. 5 after a three-month hiatus, and has purchased A$8 billion ($5.9 billion) since then.
“Restrictions imposed by the Victorian Government have had a devastating impact on the economy,” Treasurer Josh Frydenberg said in the statement. “As we have seen in other states, if you can successfully suppress the virus jobs will return.”
The federal government expects that more Victorians will be using its JobKeeper program — which pays companies for retaining workers — in the December and March quarters than across all of Australia’s other states.
Victorian household spending is now down 30% year-to-date, from flat mid-July, even as Australia-wide it has declined 3%, the Treasury said.
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