Contracts in COVID-19 (yet another blog about Full Employment)

The Federal Government have done it! Unemployment has fallen below 5% with a measurement of 4.9%, a number not seen since before the pandemic. As you would know, this is incredibly close to our goal of full employment which is the lowest unemployment rate possible without causing unnecessary inflationary or external pressure where only around 4.5% natural unemployment exists.

So a celebration is totally warranted right? These numbers can only signal great times ahead for the Australian economy as we stream roll our way out of the pandemic surely?

Well, let's just put a hold on any celebration for now. One thing you need to know about the way unemployment is measured in Australia is that it is a lagging indicator. This means that by the time the 3 months of unemployment data is finally reported, the economy has already moved on. This means that this data does not at all take in to account any of the Delta variant lockdowns which have occurred Australia-wide. This is especially relevant when the NSW lockdown does not appear to be ending any time soon and therefore a significant increase in unemployment in NSW is incredibly likely but this wouldn't be reported until we eventually get the September unemployment figures.

Now let's talk about an area where significant levels of employment are currently being created. COVID testing and Vaccine hubs. These two areas are employing 10s of thousands of people across Australia to help manage the pandemic and the pathway out of the pandemic. The thing about these jobs though? They're all temporary contracts! Many of which only exist until the end of 2021 with the chance of a brief extension into 2022. But then what happens once vaccinations are above the 70% target and COVID testing fever clinics are no longer needed? Well then all of these nurses and health care professionals will have to compete over the limited health care positions available now that COVID is likely to be putting less strain on our health system.

So there you have it, maybe the unemployment data isn't all it's cracked up to be, but if you're here and reading these posts you probably already knew that.