A year ago, much before the breaking out of Coronavirus, the job situation was not so bad despite worries of an economic slowdown. Still, the jobless rate was stuck at 5.2%.
It was because, although new jobs were being added at rates more than expected, the supply of labour expanded equally fast as more people went looking for work.
The Reserve Bank of Australia always considers the labour market as the prime consideration for whether it needs to cut rates further.
The government's world over has been wrangling over this with more aid and other measures. In the US also, though job losses remain high, the number of Americans applying for unemployment dropped last week, slipping below 1 million for the first time since the economic shutdown sparked by the coronavirus pandemic began in the spring. Another larger-than-expected decline in jobless claims suggested that the jobs recovery was regaining some momentum.
As per Tradingeconomics.com/ Australian Bureau of Statistics, Australia’s seasonally adjusted unemployment rate was 7.5% in July 2020 from 7.4% in June compared with a market consensus of 7.8%. This was the highest jobless rate since November 1998, amid the severe impact of the COVID-19 crisis.
The reopening of the economy and easing of restrictions is simultaneously adding more jobs with even more people venturing out for work.
The true picture could be worse without Government support like JobKeeper. This payment amount includes Coronavirus Supplement at $550 a fortnight. From 25 September 2020, it will reduce to $250 a fortnight and will change back to just JobSeeker Payment when the supplement stops.
The Federal Government may, though, review the measures, if the jobless rate remains uncomfortably high
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