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Treasurer Josh Frydenberg, parliament house

Source: Canva

Australia’s economic recovery is ‘gaining momentum’ says Treasurer

Treasurer Josh Frydenberg has said the declining number of workers relying on JobKeeper, is a sign that the economy is on track for recovery.

Speaking to Today this morning, Mr Frydenberg said the number of workers whose wages were being subsidised by the program dropped from 3.6 million in September to 1.5 million in October.

“There will some businesses that don’t make it and some jobs that cannot be saved. But it’s our analysis the unemployment rate will come down next year and the year ahead even after JobKeeper comes off at the end of March,” he said.

JobKeeper requires businesses to show a 30 per cent reduction in turnover compared to before the pandemic.

Some 450,000 fewer businesses qualified for JobKeeper in October compared to September.

The 2020-21 Budget assumed there would be 2.2 million recipients for the December quarter, but the actual figure is likely to be some 700,000 people lower.

“The economic recovery is gaining momentum and these JobKeeper numbers are very encouraging,” he said.

“We saw 178,000 jobs being created last month. We have seen consumer confidence up across the country and 11 in the last 12 weeks and we have seen the effective unemployment rate, which is our focus, come down from 9.3 per cent down to 7.4 per cent.”

Innes Willox, Chief Executive of Ai Group the national employer association, has also said the declining amount of people on JobKeeper has been a promising sign.

“The lower than expected number of businesses eligible for JobKeeper since the end of September is an encouraging sign of an economy picking up more firmly than was previously anticipated,” he said. 

“This is in line with the more optimistic outlook from the Reserve Bank and the strong gains in employment recorded in October.”

Jim Chalmers, Labor’s Treasury spokesperson, said the Australian economy is still suffering, and it was not time to celebrate yet.

“What looks like a recovery on paper will still feel like a recession for many Australians,” he said.

“The Morrison Government and Josh Frydenberg shouldn’t be congratulating themselves while unemployment queues are still lengthening.”

Unemployment was 7 per cent in October, and underemployment was 10.4 per cent, according to the ABS.

Chinese-Australian trade tensions addressed

Mr Frydenberg also said China’s tariffs on Australian trade, which have been crippling for many Australian businesses, was damaging for both economies.

“This is a challenging time with Australia’s largest trading partner in China,” he said.

“But it is a mutually beneficial relationship. China benefits greatly from Australia’s iron ore which underpins its economic growth.

“We will obviously work through these issues.”

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Ellie Dudley

Ellie Dudley

Ellie Dudley is a journalist at Dynamic Business with a background in the startup space and current affairs reporting. She has a specific interest in foreign investment and the Australian economy.

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