Unemployment rate set to hit 26 year high
THE unemployment rate will skyrocket to a gut-wrenching 10 per cent - the highest in 26 years - leaving one in every 10 Australians looking for work on the dole scrap heap.
The deadly contagion has throttled the Australian economy, with Treasury to estimate today that the coronavirus will double the unemployment rate in just four months.
However, in bittersweet modelling, Treasury will also reveal that the rate would have exploded to 15 per cent if the Federal Government did not unleash the $130 billion JobKeeper program.
In February, the unemployment rate was 5.1 per cent. It is expected to hit double digits in the June quarter.
The last time the unemployment rate hit 10 per cent was in April 1994. It hit 11.2 per cent in December 1992 after the 1991 recession.
The data in this form only goes back to 1978.
Treasurer Josh Frydenberg will today urge businesses to sign on to his signature JobKeeper package, which will start hitting businesses' bank accounts in the first week of May.
The news comes as pressure continues to mount on the Government to do more for the aviation industry, foreign workers and students, and short-term casuals.
The Courier-Mail understands there is little appetite for the Government to borrow more money, especially after Standard & Poor's put Australia's AAA credit rating on negative watch.
Mr Frydenberg said the coronavirus has hit the economy much harder than the GFC more than 10 years ago.
"Businesses across a range of industries have had to close their doors and others have seen a significant drop in activity as countries … exercise social distancing measures to contain the spread of the virus,'' he said.
"It is against this backdrop the Government has taken action, with $320 billion or 16.4 per cent of GDP in economic support for the Australian financial system, businesses, households and individuals affected by the coronavirus.
"Given these actions and the position of economic strength from which we approached the coronavirus crisis, Treasury expects the unemployment rate to rise to 10 per cent in the June quarter from 5.1 per cent in the most recent data.
"In the absence of the $130 billion JobKeeper payment, Treasury estimates the unemployment rate would be 5 percentage points higher and would peak at around 15 per cent."
Mr Frydenberg said more than 800,000 businesses had registered for the JobKeeper payment, to provide workers with $1500 a fortnight.
Originally published as Unemployment rate doubles in four months