Is the economy recovering at a faster pace?
Team Veye | 24 May 2021
Australia has had the world’s longest growth run till a couple of happenings impacted it. The devastating fires occurring twice over had an adverse effect with Covid further aggravating it.
Almost one million jobs were lost with gross domestic product falling severely. But the quick handling of the crisis by the government has resulted in our economy recovering faster than expected.
When the RBA deputy governor declared last October that the economy would grow in the September quarter, very few people had actually believed that the recession was over.
Australia is now showing fast results of strong economic recovery from last year’s recession. According to reports, business conditions and confidence were running well above their long-run averages with profitability.
According to Australian Bureau of Statistics, Unemployment rate decreased to 5.5% for April 2021. This was the lowest jobless rate since March 2020, as the economy recovered further from the COVID-19 hit. Obviously, the end of JobKeeper wage subsidy did not have any perceptible impact.
The end of the JobKeeper wage subsidy on 28 March 2021 was expected to result in some people losing their jobs or changing jobs. However, analysis by the ABS of changes in employment and hours between March and April did not identify a clear aggregate impact from the end of JobKeeper.
Trading and employment are all well into expansionary territory. The National Australia Bank’s quarterly business survey showed that this improvement is broad-based in most industries. The survey suggests that the economic recovery built further momentum in Q1. Forward orders and expected forward orders in three months time recorded another strong increase.
None of the big four bank economists expect a negative quarter this year and
have in fact been repeatedly upgrading their GDP forecasts. Treasurer Josh
Frydenberg has even boasted that Australia’s regrowth is better than most.
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