The release yesterday of the Reserve Bank’s June board meeting minutes a fortnight ago did not change thinking on the outlook for the economy – it’s still tough, interest rates will remain low and unemployment is the biggest problem, even though it may not quite be the same concern as it was when the lockdowns started in March.
RBA Governor Philip Lowe said in his statement after the meeting that the recession may not be a deep as previously thought and that the slump was looking a bit shallower than first thought.
Certainly, the ASX is starting to believe that, while also reacting to the Fed’s announcement that it has finally settled on a corporate bond-buying plan and by the nice noises coming from the Bank of Japan meeting in Tokyo yesterday.
The message from all three central banks (RBA included) was that the stimulus is here to stay and for as long as the economy remains weak, which could be the next three years!
That view was reinforced yesterday by the release of the latest weekly payroll data from the Australian Bureau of Statistics.
The ABS found there was a small improvement in jobs in May, though the figure remains 7.5% below the week ending 14 March, when Australia recorded its 100th coronavirus case and was yet to feel the full brunt of lockdown.
The latest release of weekly payroll figures from the ABS shows payroll job losses since mid-March were greatest in the week ending 18 April at 8.9%.
The figure had recovered to a 7.5% loss by the end of May, confirming the better than forecast April jobs improvement.
Tuesday’s data shows payroll jobs worked by women increased by 1.4% through May, compared with 0.4% for males.
But total female job losses since mid-March are still greater at 8.0%, compared to 6.3% for males.
The losses and improvements are due to the industry sectors where female employment is high – such as hospitality, cafes, restaurants, pubs, and clubs.
Some of the industries most heavily impacted by COVID-19 showed a slight recovery in payroll jobs through May, the ABS said.
The ABS said that accommodation and food services saw a 5.0% improvement through May, but was still 29.1% than in mid-March.
The ABS also made the interesting point that jobs worked by multiple jobholders were heavily over-represented in the losses.
Around 29% of jobs lost since mid-March were previously held by people as a secondary job.
The ABS said JobKeeper support can be sought for only one job for each eligible employee.
“Looking at the week-to-week changes, there was a 0.4 percent increase in the number of payroll jobs in the week ending 30 May, following no change recorded in the week ending 23 May,” Head of Labour Statistics at the ABS, Bjorn Jarvis, said in yesterday’s release.
The number of payroll jobs is not the same as the number of employed people in the Labour Force statistics for a number of reasons one of which is multiple job holding.
