Australia’s Economy Starts Recovery From CCP Virus but ‘Bumpy Road Ahead’: Treasurer

Australian Treasurer Josh Frydenberg speaks to the media during a press conference in Melbourne, Australia, Sept. 28, 2018. (AAP/David Crosling/via Reuters)

Australia has begun to recover from the economic fallout of the CCP virus pandemic, but federal treasurer Josh Frydenberg is warning there is still a “bumpy” road ahead.

ATO data shows that in October, there were two million fewer workers and about 450 thousand fewer businesses on the federal government’s JobKeeper wage subsidy program compared to the September quarter.

The number of JobKeeper recipients has also fallen from 3.6 million to 1.5 million in less than two months, outperforming predictions in the federal budget.

Frydenberg told SkyNews on Oct. 30 that the new numbers are “very encouraging.”

“They indicate that Australia’s recovery is well underway and gaining momentum,” he said.

It builds on earlier positive news that 178 thousand jobs were created in October, contributing to the reduction in the effective unemployment rate from 9.3 to 7.4 percent.

Consumer confidence also went up to 11 after improvements in Victoria’s public health situation and Australia retained its AAA credit rating, the treasurer said.

“We’re certainly trending in the right direction, but we know that the road ahead will still be hard, it will be bumpy, it will be long,” Frydenberg said. “There’s a lot of damage that has been done not just to the national economy, but to the global economy.”

The government will also keep the Jobkeeper program in place until the end of March to help Australia “make up a lot of ground.”

Shadow treasurer Jim Chalmers said the government was falling over itself trying to claim credit for a recovery in the economy.

“But every serious economist knows, when we’ve had a recession as deep and as damaging as Australia has, that of course the economy will recover,” he told reporters in Canberra.

Chalmers said the new JobKeeper numbers were welcome but entirely unsurprising, given the easing of business restrictions and tighter eligibility requirements.

He said for many Australians, what looked like a recovery on paper would still feel like a recession, and looming cuts to the wage subsidies would still hurt 1.5 million workers.

The government’s JobKeeper wage subsidy was initially legislated for only six months at $1500 per fortnight. At the end of the six months, in September, it was extended until March at a reduced rate of $1200 per fortnight. In January, it will fall to $1000 until March, when the scheme is scheduled to end.

The latest tax office numbers come as federal politicians prepare to vote on various welfare rules and unemployment benefits.

AAP contributed to this article