Tasmanian unemployment rate predicted to hit 8.6 per cent amid coronavirus restrictions



For 18-year-old Rosny College student Gabrielle Kidd, Tasmania’s economic downturn has already begun to bite.

Ms Kidd has applied for 35 jobs in the past few months, with no luck.

“I keep getting told [businesses] aren’t hiring,” she said.

She is fearful her future career prospects will also suffer, after her year 12 studies were interrupted by COVID-19.

The Deloitte Access Economics Business Outlook report for June indicates Tasmania’s economic situation is set to get worse before it improves.

The report said Tasmania entered 2020 on a roll, with the state’s economy one of the best performing in the country.

But, with that boom driven largely by the international education and tourism sectors, Tasmania was exposed to the impacts of coronavirus-related travel and operating restrictions.

The Deloitte report makes a series of predictions about how the state’s economy will perform moving forward — it expects unemployment to rise to 8.6 per cent in 2021, before falling again to 5.7 per cent in 2024.

International tourists will fall from 90,000 in 2019 to 39,000 in 2021, and gross state product will fall from growth of 3.6 per cent in 2019 to a decline of 0.2 per cent in 2021, before rebounding.

Tasmania’s population growth is expected to dip before rising again in 2023.

Opening borders, extending JobKeeper ‘key’ to state’s recovery

The Tasmanian Chamber of Commerce and Industry’s Michael Bailey said opening up the borders and convincing the Federal Government to continue the JobKeeper payment beyond September would be key to the state’s recovery.

“It really is going to take our economy to really start booming again to see businesses hiring,” Mr Bailey said.

He said the state would need to increase the number of Tasmanians choosing to complete higher education courses to support the education sector.

“We know we have some of the lowest numbers of participation in higher education of any state in Australia, so there’s a lot of work we can do in our own state,” Mr Bailey said.

“Also, nationally, people want to come to Tasmania to study so we need to make sure we advertise strongly across mainland students and bring them to our state.”

Deloitte is predicting Tasmania’s economy will achieve a modest recovery once the pandemic is over, but economic activity is unlikely to return to pre-COVID-19 levels for some time.

Report not a shock

Mr Bailey said the report did not come as a shock.

“What we know is it will take longer for us to come out of the recession than it will take other parts of Australia to achieve, and that’s because the nature of our market is really dependent on tourism and education,” he said.

“We’re going to need to work hard to build those markets back up.”

The Deloitte report said travel restrictions had led to dozens of Airbnb and short-stay accommodation dwellings becoming available on the private rental market for six to 12-month leases, but warned the situation was unlikely to last when borders reopen.

It said rents in Hobart had fallen more than any other capital city between March and May, partly as a result of the decline in international students.

Ben Bartl from the Tenant’s Union of Tasmania said the rent decline amounted to only about $5 per week which was not “a significant amount,” and that the Government should to act to regulate the short-term accommodation sector.

“It seems like many investors are waiting to see what happens with the borders, hoping that the borders will reopen sooner rather than later, so that they can return those properties to the short-term accommodation sector,” he said.

The State Government has previously said local councils could regulate short-stay accommodation.

Deloitte Access Economics partner Chris Richardson said Tasmania’s young people had been significantly impacted during the push to beat coronavirus.

“In the meantime though, we’ve lost jobs, and that’s been in particular younger Tasmanians who have lost their jobs in defence of the health of older Tasmanians,” he said.

“The next fight is pretty tough. The fight against the virus was a sprint, the fight to get the jobs back is going to be a bit of a marathon.”

Mr Richardson said it could take around four years for the economy to return to where it was pre-COVID-19.



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