The COVID-19 Coronavirus pandemic hit the Australian economy hard and one of the casualties was jobs.
The rising unemployment numbers reinforces just how quickly the economy has slowed, and despite the horror of the numbers reported, things still have a way to go before we reach the bottom.
So how many people are really unemployed in Australia?
According to Roy Morgan Research in May 14.8% of the workforce (2.09 million Australians) were unemployed.
This is more than double the current ABS estimate for April 2020 of 6.2%.
But the good news is that this is down 69,000 on April as Australia begins to open up.
This means a massive 3.46 million Australians (24.5%) are either unemployed or under-employed, down 25,000.
The decline in unemployment is good news as the Australian economy opens up but also illustrates how far the economy needs to go to return to the state it was in pre-lockdown.
Compared to early March, the last measure before lockdown, there are an additional 1.07 million Australians unemployed (+7.5% points).
Latest Roy Morgan employment series data for May shows:
- The workforce in May was 14,128,000 – comprised of 12,038,000 employed and 2,090,000 unemployed Australians looking for work. The workforce total is down 22,000 since April;
- 12,038,000 Australians are employed in May, up 47,000 from April including 7,908,000 employed full-time, up 82,000, and 4,130,000 employed part-time, down 35,000;
- 2,090,000 Australians are looking for work in May, down 69,000 from April, driven by a fall in the number looking for full-time work which fell 94,000 to 907,000. 1,183,000 are looking for part-time work, up 25,000;
- Roy Morgan’s unemployment figure of 14.8% for May is more than double the current ABS estimate for April 2020 of 6.2%.
- However, the ABS figure for April estimated a large decline in the size of the workforce which they said was down 490,000. If the ABS workforce estimate for April had matched that in March the ABS unemployment figure would have been 9.8% (1.35 million).
Roy Morgan Unemployment & Under-employment (2019-2020)
Source: Roy Morgan Single Source January 2019 – May 2020. Average monthly interviews 4,000.
Michele Levine, CEO Roy Morgan, says restrictions are now being eased around Australia however a quarter of the Australian workforce is now unemployed or under-employed - obviously an under-estimation as 3.5 million are currently subsidised on JobKeeper:
“Roy Morgan’s unemployment measure for May shows 2.09 million Australians were unemployed (14.8% of the workforce) with an additional 1.37 million (9.7%) under-employed.
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“In total a massive 3.46 million (24.5%) Australians are now either unemployed or under-employed, down 25,000 since April. If this number continues to drop at the rate of 25,000 per month it will take over four years until September 2024 before it approaches the levels of early March 2020.
“The trend in May is in the right direction as the Australian economy opens up but compared to the labour market situation pre-lockdown an additional 1.3 million Australians are now unemployed or under-employed – and this is while the JobKeeper program is still running.
“Earlier this week Treasurer Josh Frydenberg accepted Australia had entered its first recession for three decades. For Australia to emerge from this recession quickly during the next few months businesses and unions must work together to forge sensible and equitable solutions that encourage employers to hire new workers.
“A special Roy Morgan SMS survey conducted this week showed the recent Federal Court decision to award extra entitlements to certain categories of casual employees will effect up to 794,000 Australian businesses. A quarter of businesses (567,000) say they will be deterred from hiring casual employees and over 1-in-20 businesses (123,000) say the decision will ‘force them to close’.
“These results show that if businesses and unions don’t work together to develop sensible and realistic industrial relations many hundreds of thousands of Australians that have been put out of work as a result of the ‘COVID-19 Financial Crisis’ (CFC) will struggle to find new jobs and risk becoming long-term unemployed.”
This Roy Morgan survey on Australia’s unemployment and ‘under-employed’* is based on weekly face-to-face interviews of 684,202 Australians aged 14 and over between January 2007 and May 2020, and includes 6,698 telephone and online interviews in May 2020. *The ‘under-employed’ are those people who are in part-time work or freelancers who are looking for more work.