Expectations vs the economy

The effects of COVID-19 have seen unprecedented repercussions for the Australian workforce, with the younger generation feeling the brunt of the blow.

The change in many young Australians’ employment has forced them to re-evaluate their financial situations and perspectives.

The Australian Bureau of Statistics released today’s figures stating 600,000 Australians lost their jobs between March and April 2020, causing the unemployment rate to rise from 5.2 to 6.2 per cent.

The statistics showed six million workers are now receiving Jobkeeper payments, with a further 1.6 million on Jobseeker or youth allowance support.

Youth unemployment rose from 11.5 to 13.8 per cent, as their main employing business sectors of hospitality and tourism were hit the hardest.

Business sectors affected by COVID-19. Photo: Isabel Vieira.

During this morning’s COVID-19 news conference Prime Minister Scott Morrison said how important it was to get young people back to work once we go through the process of re-opening the economy.

“We don’t want an Australian economy that’s propped up by subsidies, we want an Australian economy that’s propped up by strong businesses,” he said.

“It is important that when you have what are, effectively, unemployment benefits through Jobseeker at the levels they are … it can provide abnormal circumstances, a disincentive with payments at that level for people to go and seek work, and that’s why these arrangements with the COVID-19 supplement are temporary arrangements.”

Prime Minister Scott Morrison provides updates on Covid-19.

ANZ Bank Financial Planner Amber Dawson says she believes government payments such as Jobkeeper and Jobseeker have changed some people’s expectations.

“For example, a casual worker that would not often earn $750, has been receiving $750 on a Jobkeeper payment,” she says.

“There is some reluctance to return to work and that might be veiled by the fact they say that they are comfortable due to COVID but really, it’s because they’ve been receiving this handout that they’ve not physically had to work for,”

“I think it [government support payments] has changed people’s expectation of the government supporting them, I would say that’s a negative even though the government had good intentions.”

Work boots vs slippers – whose shoes would you rather be in? Photo: Isabel Vieira.

University student and ‘essential’ worker Brooklyn Crews says she feels fortunate to still be working while receiving government payments, especially while studying.

“I definitely prefer my current situation receiving more government support and more time to study, I would even consider quitting my job to focus completely on my degree,” she says.

“Education is so important and if we were able to maintain such student support, we would be able to combat other issues like student burnout.”

Curtin University Economics Professor Siobhan Austen says the economic fallout from COVID-19 will have the greatest effects on young people working now and moving forward into their future careers.

“Partly it’s likely to have significant effects for young people, as they tend to be working in the sectors of the economy that have been badly hit, they’ve been more affected by unemployment than any other group,” she says.

“As the economy slows down people’s chances of moving up the career ladder becomes weaker.

“People who are heading into their first career jobs or just starting out in careers at the moment, I don’t think they’re in the best position you would hope for.”

University student and ‘essential’ worker Lauryn Wrightstone says her perspective upon the workforce has changed since working throughout the pandemic.

“I do view work differently, especially with being classified as an ‘essential’ worker even thought I often wish that wasn’t the case,” she says.

“I do however feel very lucky as a casual to still be able to save and earn money in this time as I know many of the job saver schemes don’t apply to casuals.

 “It is comforting to know there is still some government assistance to fall back on, especially when I compare my situation with American supermarket workers whose minimum wage is so incredibly low, I feel lucky in that sense.”

Professor Austen says COVID-19 has highlighted how insecure many work arrangements are.

“I think we’ve now got opportunities to improve the way people are employed and the sorts of contracts they can get, and they way they are paid,” she says.

Mrs Dawson says she’d hope young people recognise the importance of saving money for future unforeseen circumstances.

“I think as a financial planner I’d love to hear that people even before the pandemic, had a rainy-day fund or a buffer where they could start to tap into before they had to rely on a government handout,” she says.

“That’s just part of being a responsible adult I believe.”