Don’t shoot the messenger but the real unemployment figure is worse. I not only write resumes and help get people jobs. I analyse LGA unemployment figures as I know the ABS methodology. In real terms, total unemployment is closer to 2 million.
A record 600,000 Australians lost their job in April. The previous monthly record, of 65,400 jobs lost in October 1982 during that year’s deep recession, has been dwarfed.
Payroll data recently collated by the ABS suggests more than 900,000 people lost their job in six painful weeks.
But the tight definitions and the equivalent of methodological ‘footbinding’, clouds the real number of unemployed.
The April job numbers are based on a survey carried out in the first fortnight of the month. It has picked up the impact of business closures and social distancing restrictions.
The ABS defines people paid through the JobKeeper scheme as employed, even if they have been stood down. There are about 5 million Australians being supported by JobKeeper, with many of those not working at all.
Unfortunately, we know that some businesses won’t survive the shutdown. Another million people will head to Centrelink once the JobKeeper payments end in September.
Keep in mind the ABS also defines someone as employed if they are on any kind of paid leave (even if workers are being forced to take that leave) or someone who may have been stood down without pay but believes they still have a job.
An irony in the job figures is the participation rate, which measures the number of Australians with a job or in search of one. If people give up looking for a job, they are not counted as unemployed and that drops the unemployment rate. Up there for thinking.
About one million people are now getting supporting through JobSeeker (the old Newstart or dole payment). But just getting JobSeeker doesn’t necessarily mean you’ll meet the official definition of unemployed.
People can get JobSeeker and still be employed part time if they meet a low-income test. To be unemployed for the ABS, a person has to be actively looking for full- or part-time work over the past month and be available to take on that job.
In March, Australians collectively worked 1785 million hours. The participation rate in April has dropped a staggering 8 per cent.
That’s a substantial hit to household income, even with the dramatic increase in government assistance. It will shackle spending as restrictions are eased.