Frydenberg: Year to forget for Australia
Treasurer, Josh Frydenberg, has described 2020 as a ‘year to forget’ for Australia as the unemployment reaches a 19-year high of 7.1%.
Speaking at a Bloomberg conference, Frydenberg said it had been a difficult year as a result of the COVID-19 pandemic but that he was more optimistic than the official Organisation for Economic Co-operation and Development (OECD) and International Monetary Fund (IMF) forecasts.
“The OECD and IMF are being a bit pessimistic about the global economy in this calendar year. OECD has forecast a fall of 6.1% this calendar year which is a big drop but it will be a bit less in Australia at 5% and then we can expect growth of 4.1% next year.
“I think there are some sectors that will recover faster than others as a result of the international border closures but that will be helpful for the economy next year after a year to forget this year.”
Unemployment figures reached 7.1% in May, up from 5.3% in March and the highest figure in 19 years, after numerous sectors such as arts, hospitality and retail saw job cuts as a result of the pandemic, with total job losses since March reaching over 835,000. The previous high point was 7.2% in October 2001.
While Frydenberg admitted unemployment would rise, he disputed that it could reach double-digit figures in the coming months. The 8% rate forecast for September quarter was down from figures as high as 10% earlier this year.
“Unemployment will get higher in the coming months, we are forecasting 8% for the September quarter but there are also more people coming back to the workforce as restrictions are eased which is a good thing.”
AUTHOR
Laura Dew
Recommended for you
Quarterly Wealth Data analysis has uncovered positive improvements in financial adviser numbers compared with losses in the prior corresponding period.
Holding portfolios that are too complex or personalised can be a detractor for acquirers of financial advice firms as they require too much effort to maintain post-acquisition.
As the financial advice profession continues to wait on further DBFO legislation, industry commentators have encouraged advisers to act now in driving practice efficiency.
New Zealand’s financial regulator is following the footsteps of its Tasman neighbours and proposing to conduct a review on improving the accessibility of financial advice and advice business models.
