Insights into a post COVID recovery


Understanding how Covid lockdowns have impacted certain individuals and industries, helps to inform us about how quickly the economy and markets may recover.

With this in mind, I thought it was useful to share a number of charts published recently by the RBA and banks which provide important and interesting insights.

Covid has discriminated against younger workers and lower income earners

Workers between the ages of 15 and 34 account for more than half of the jobs lost (unemployment) until August (even more until May).

Sp Gov 2020 10 15 Graph01

The RBA broke up changes to employment into five groups – from the highest income earners to the lowest earners.

As the chart below shows, the lowest paid 40% of Australian’s suffered the largest loss of employment (over 80% of the total jobs lost to August).

Sp Gov 2020 10 15 Graph03

It is not surprising to see that Covid has impacted a finite number of industries, especially hospitality and travel.

Sp Gov 2020 10 15 Graph02 1

The good news is that employment has recovered significantly between May and August – as denoted above by the dark-blue dots versus the light-blue bars.

Those that have been less impacted have been saving money and repaying debt

For those that have not been materially impacted by Covid, disposable incomes have actually increased (mainly due to low rates), consumption has fallen (due to lockdowns) and the saving ratio has increased significantly.


People have been making larger repaying towards credit card balances.


And borrowers have been making larger principal repayments and/or accumulating more cash in offset accounts.

So, overall, personal debt has reduced during Covid.


Spending and confidence has rebounded strongly

National consumer spending (using credit card data compiled by ANZ) is 8% higher than this time last year.

Victoria has rebounded strongly.

This demonstrates that the cohort of people that have not been impacted by Covid more than make up for those that have.

Large spending increases have been observed in furniture, homewares and electrical categories.


Consumer confidence (per Westpac/Melbourne Institute) is now at a 7 year high.

It is likely that confidence has been buoyed by Australia appearing to now be Covid-free and people can now see past 2020, looking towards a Covid-normal 2021.

The possibility of a successful vaccine arriving in the first half of next year also helps the global economic outlook.

Consumer Confidence 768x432

What does all this data tell us?

1. Higher earners will probably drive the property market recovery

The above data demonstrates that there are two cohorts of Australians.


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Stuart was a Chartered Accountant before establishing mortgage broking firm ProSolution Private Clients. He has authored two books and shares his experience with readers of Property Update. Visit

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