Hospo workers could bear the brunt of Sydney lockdown

The sudden two week lockdown of Greater Sydney is estimated to cost $143 million a day in lost activity.

Further to this, over $2 billion will be wiped from gross domestic product (GDP).

NSW Premier Gladys Berejiklian indicated that a support package for businesses affected by the lockdown would be announced in the coming days. In the meantime, the Commonwealth has started the same hotspot income support program it implemented during Victoria’s latest lockdown.

On Saturday, Scotti Morrison announced on Facebook “These same payments of up to $500 per week were made also available during the most recent Melbourne lockdown.”

According to the Australian Bureau of Statistics, many businesses will need to lay off workers due to the absence of JobKeeper, as was the situation in Victoria recently.

One in 10 accommodation and hospitality workers lost their job or had no hours of work during the first week of Victoria’s lockdown.

If the same were to happen in NSW, that would mean 26,000 people out of work.

The Victorian experience had a flow on effect throughout other states, with the ABS payroll data revealing almost no region was spared from job losses and wage hits.

As shown in an AMP analysis, the current NSW lockdown includes around 6.6 million people and represents 25 per cent of Australian GDP.

“We estimate a hit to economic activity from the lockdown of about $2 billion if it’s contained to two weeks, with much of that likely to be recouped upon reopening,” said AMP Capital chief economist Shane Oliver.

“Fortunately ... the lockdown is starting relatively early, providing some confidence that it can be contained to two weeks.”

28th June 2021