Australia COVID: Businesses ‘hoarding’ staff during lockdown, says ANZ chief economist

Lockdowns in four of eight capital cities in the final two weeks of June led to a 1 per cent fall in payroll jobs, with greater Sydney leading the decline, followed by Brisbane, Darwin and Perth.

But businesses appear to be “hoarding” staff, according to ANZ senior economist Catherine Birch, choosing to reduce hours rather than lay off people to avoid delays and costs in rehiring once restrictions ease.

ABS jobs data for June showed falls in unemployment (down from 5.1 per cent to 4.9 per cent), but also hours worked in Victoria (down 8.4 per cent), which spent almost half the month in lockdown.

ANZ is forecasting the jobless rate to continue to fall to 4.4 per cent by the end of the year, and Ms Birch said the bank remained “upbeat about the longer-term outlook” for employment.

Further tightening of restrictions in Sydney, including the closure of the construction sector, as well as fresh lockdowns in Victoria and South Australia are expected to drag on employment in July.

The ABS payroll jobs data for June showed falls in every capital city, with Sydney down 1.9 per cent, Brisbane and Darwin both down 1.3 per cent and Perth down 1.1 per cent – all had a locked down during the fortnight.