JobKeeper will no longer be available leaving almost a million people in the lurch and 150,000 more workers without a job.
The government assistance aimed at keeping businesses open and employing staff began on March 30, expired on Sunday.
The scheme was brought in to help struggling workers and businesses during the brunt of the Covid-19 crisis and became a saving grace for more than a million Australians.
The government extended the program twice before finally deciding it would end on March 28.
Data from the Australian Taxation Office shows 980,000 workers still rely on the program with NSW and Victoria the most dependent of the states.
JobKeeper will no longer be available leaving almost a million people in the lurch and 150,000 more workers without a job
Treasurer Josh Frydenberg said the economic recovery in Australia has been stronger than almost anywhere else in the world
Treasury officials have also added 150,000 workers will most likely lose their jobs and be forced onto the dole.
In spite of this, Treasurer Josh Frydenberg said the economic recovery in Australia has been stronger than almost anywhere else in the world.
‘Today the temporary emergency support program JobKeeper comes to an end,’ he said.
‘It has achieved its objectives of supporting businesses and saving jobs, preserving employment relationships and delivering much needed income support across the country.
‘JobKeeper was an economic lifeline which helped keep around a million businesses and 3.8 million Australians in a job at the height of the pandemic.’
More than 2.8 million workers and 680,000 businesses left JobKeeper over the duration of the scheme.
Victoria still has 369,000 people dependent on the scheme while NSW had 327,000 people relying on it last month.
‘Just because JobKeeper has come to an end does not mean the government’s support has,’ Mr Frydenberg said.
‘Our Economic Recovery Plan will continue to support the economy through targeted support measures as well as tax cuts, business incentives and a record investment in skills and training, and infrastructure.’
The Reserve Bank said the wage subsidy had saved more than 700,000 jobs.
With the recession at an end, the number of people on the dole dropped from 1,319,268 at the start of 2021 to 1,166,611 a week ago.
The unemployment rate sits at 5.8 per cent.
More than 2.8 million workers and 680,000 businesses have left JobKeeper over the duration of the scheme
The Reserve Bank said the wage subsidy had saved more than 700,000 jobs
It is expected to rise once JobKeeper ends but it is unclear how many people will shift from it to the dole, now known as JobSeeker, which is also scheduled to be less generous later in the week as the coronavirus supplement ends.
Official estimates put the employment losses at between 100,000 and 150,000.
Prime Minister Scott Morrison said it was not necessarily the case that the number of unemployed would rise.
‘In less than a year the number of people employed is now greater today than it was when the pandemic hit this country,’ he told parliament during the week.
Westpac’s Justin Smirk says one figure he is closely watching is the jump in those working zero hours for economic reasons.
‘At 106,700 in February compared to a monthly average of 55,100 through 2019, we see any number above 60,000 as an indication of potential job losses as JobKeeper scheme expires,’ he said.
The scheme was brought in to help struggling workers and businesses during the brunt of the Covid-19 crisis and became a saving grace for hundreds of thousands of Australians (pictured, a jogger runs by the deserted Flinders Street Station in Melbourne during lockdown in August)
‘At this stage we see the ending of JobKeeper generating a minor stalling of employment with only a very modest rise unemployment.’
Some businesses are at risk of defaulting on payments, or even folding, as they adjust to the end of JobKeeper.
CreditorWatch chief economist Harley Dale said bankruptcies and insolvencies wouldn’t ‘fall off a cliff’ as first anticipated because the number of businesses on JobKeeper has dived as the economy recovered.
‘At the JobKeeper peak in the second and third quarters of last year, around one million businesses were receiving the payment, but this number had halved by the fourth quarter,’ he said.
He said 8,000 businesses would be insolvent by the end of the second quarter of this year.
Labor leader Anthony Albanese says while JobKeeper must come to an end at some point, it is ‘unwise’ to withdraw support from industries and businesses still impacted by the pandemic
But the long-term effects won’t be as severe as first expected due to ongoing government support such as tourism and aviation packages, cheap loans for small businesses and apprentice wage subsidies.
However, the greatest uncertainty lies in how many companies are not commercially viable, which has been masked by subsidies and other support.
Labor leader Anthony Albanese said though JobKeeper must come to an end at some point, it was ‘unwise’ to withdraw support from industries and businesses still impacted by the pandemic.
‘This isn’t an academic exercise. This is real people who are going to be impacted by this,’ he said.