Unemployment increased in March and is expected to soar in the months ahead as the full impact of the lockdown becomes clear.
The unemployment rate increased to 5.2 per cent from 5.1 per cent in the previous month, but that number will likely rise to 10 per cent.
“The March employment data is dated because the survey refers to employment in the first half of March (up to the 15 March generally) so it doesn’t capture the full extent of the international travel ban on 18 March and the non-essential lockdown measures from 23 March which impacted millions of individuals,” said AMP Capital senior economist Diana Mousina.
“The worst month for job declines and the surge in the unemployment rate will likely be in April. However, employment growth will remain low for some time.”
Numbers released by the Treasury show that unemployment could have increased to as much as 15 per cent without the government’s successive stimulus packages, but Prime Minister Scott Morrison said that Australians still needed to prepare for “sobering news” on the economy.
“Today’s unemployment rate showed only a modest change from the figures for February but as we all know those figures were largely based on the middle of March and that was in particular before you put in place the restrictions across the economy towards the back end of March," Mr Morrison told media.
“While that figure is welcome we know that is the best figure we will see for some time.”
However, the restrictions that have led to the spike in unemployment are unlikely to be lifted anytime soon, with the government wanting to expand its testing capabilities before it makes a move. Modelling from the Actuaries Institute suggests that there could be as many as 20,000 carriers of the virus in the community.
“A straightforward analysis of data available suggests that confirmed active cases hugely under-report community infection,” said Dr Douglas Isles.
“We need to talk more about estimates and monitoring of community infection. Those risks need to be better understood before authorities decide when and how to relax current restrictions, an issue looming large for policymakers.”