Financial advisory firm KPMG has warned that the lockdown in the Sydney northern beaches suburb of Avalon could cost $3.2 billion due to the loss of working hours in December.
“Unfortunately, that pressure brings with it an economic cost as it directly and quickly hits the supply side, and the longer it goes on, it then transfers to demand via confidence,” Rynne said.
KPMG based its analysis on estimating how the lockdown would affect the number of hours worked and how Australia’s Gross Domestic Product (GDP) would be influenced by the increase in restrictions, including social distancing and reimposed domestic border controls.
Rynne estimated that the Avalon outbreak and subsequent preventive measures meant 34 million fewer hours were worked in December than the average. This indicated the real GDP had fallen by $3.2 billion.
Rynne also noted that the effects on the economy from the lockdown would reach into January, he estimated.
Frydenberg said that the Australian economy had seen real momentum with 90,000 new jobs being created during November 2020. He noted that 84,000 of them were full-time employment.
“We’ve seen two million fewer Australian workers on JobKeeper in October compared to the month prior in September,” Frydenberg said.
But he said that while the data showed positive signs, the road to economic recovery would be challenging.
“All of that data is very positive, but the future is challenging, and we know that next year will be another hard year and the road to recovery is going to be long and pretty bumpy as well,” he said.
