The outbreak of the coronavirus (COVID-19) in Australia created highly uncertain circumstances for households, businesses and governments. In these circumstances, there are sizeable benefits for the community and governments to have access to information about the economic and social responses of individuals and businesses that is as up-to-date as possible.
On 16 March 2020, the ABS announced plans to publish new data (footnote 1), to provide up-to-date information about the economic responses of individuals and businesses to the pandemic. These data, and data from subsequent announcements (footnote 2), have played a critical role in the timely assessment of economic conditions in Australia, as well as the actual and expected impacts of the coronavirus on households.
This article provides an overview of these new ABS data and summarises their key findings for the months of March, April and May. The findings are presented in the context of policy announcements made by the Australian Government, the cumulative number of confirmed COVID-19 cases and other events occurring during these months (see appendix).
In March, COVID-19 cases increased significantly, economic impacts also significant
At the start of March, the number of COVID-19 cases in Australia was 25. However, the number of confirmed COVID-19 cases increased quickly with the number of new cases averaging 16 per day over the first two weeks of the month to averaging 293 per day over the last two weeks of the month (footnote 3).
By mid-March the World Health Organisation (WHO) had declared a pandemic (footnote 4), the Commonwealth Government had announced two separate stimulus packages (footnote 5), and the Reserve Bank of Australia (RBA) had announced plans to implement a comprehensive package of measures to support the economy and promote functioning of key financial markets (footnote 6). Social distancing restrictions to limit the spread of COVID-19 had also been implemented.
By the end of March, new high frequency ABS data had been published to measure the economic impact of COVID-19. These new data provided timely insights into people and business responses to the changing circumstances.
The Business Impacts of COVID-19 Survey provided information on the prevalence and nature of adverse impacts from COVID-19 experienced by businesses operating in Australia in mid-March. These results provided the first insights into those industries most impacted by COVID-19, and the causes of the impacts. Adverse impacts were most prevalent in the Accommodation & food services industry with over three quarters of businesses (78%) already reporting impacts and 96% of businesses reporting that they expected impacts in coming months. Businesses in Professional, scientific & technical services (21%), Electricity, gas and water supply (34%) and businesses in Mining (37%) were the least likely to have been adversely impacted by COVID-19 in the collection period. A reduction in local demand was the most common impact experienced (82%) and was also the most common impact expected in coming months (81%).
The disproportionate impact of COVID-19 on the Accommodation & food services industry was also evident in the Weekly Payroll Jobs and Wages in Australia publication, which showed a 25.6% fall in the number of jobs in this industry between mid-March and early April. This dataset provided new, high frequency information on changes in total jobs and total wages paid, for all employing businesses who report to the Australian Taxation Office (ATO) through the Single Touch Payroll (STP) system.
Data from this publication showed a 7.3 per cent decline in total payroll jobs between mid-March (footnote 7) and early May. The bulk of this decline was experienced in the last week of March and early April.
While significant declines in jobs and wages in the Australian economy occurred during March, reports of panic buying in supermarkets increased (footnote 8). Supply shortages of home office furniture and appliances were also occurring as large numbers of employees transitioned from office- to home-based work to align with social distancing restrictions (footnote 9).
These reports were first confirmed by data in the March issue of Retail Trade, Australia, Preliminary which saw an 8.2% increase in retail turnover. The final estimates from Retail Trade, Australia confirmed strong retail trade growth in Food retailing (24.1%), Other retailing (16.6%) and Household goods retailing (9.1%). Weakness in retail trade was recorded in Cafes, restaurants and takeaway food services (-22.9%) reflecting the adverse impacts experienced by the Accommodation and food services industry.
In April, the growth in COVID-19 cases slowed, economic and social impacts were extensive
At the start of April, the number of confirmed COVID-19 cases in Australia was 4,555. The number of new cases declined quickly from an average of 132 per day over the first two weeks of the month to an average of 20 per day over the last two weeks of the month (footnote 10).
By this point, the Government had announced the third economic stimulus package – the JobKeeper Payment scheme – to further support businesses and individuals. The progressive implementation of travel restrictions by governments had culminated in a ban on all overseas travel. Signs had also emerged to indicate China’s economy was starting to recover from early containment measures (footnote 11).
Throughout April, the ABS continued to produce new high frequency statistics to measure the increasingly significant impacts of the pandemic on Australian businesses and the community, and their responses to social distancing restrictions and Government support programs.
The Business Impacts of COVID-19 Survey conducted in late April confirmed a continuation of adverse impacts felt by the Accommodation and food services industry, where 84% of businesses anticipated a reduction in demand for goods or services in the next two months (highest among all industries) and 76% had registered or intended to register for the JobKeeper Payment scheme (third highest among all industries).
Data from Retail Trade, Australia, Preliminary showed retail turnover declined by a record 17.9% in April as the adverse impacts of social distancing restrictions continued. This large decline also reflected the stockpiling activities that occurred in March. Contributors to this decline included a 17.1% fall in the Food services industry and continued weakness in turnover for Cafes, restaurants and takeaway food services, at around half its level in April 2019. The strong turnover decline in the Food services industry aligned with adverse impacts reported by businesses in the Accommodation and food services industry from the Business Impacts of COVID-19 Survey.
Data from Weekly Payroll Jobs and Wages in Australia showed a further 1.8% decline in the number of employee jobs between early to mid-April. The total reduction in employee jobs in the Accommodation and food services industry deteriorated from -25.6% to -33.4% over this period.
The reduction in overseas visitors as a result of the progressive implementation of Government travel restrictions also contributed to challenges facing the Accommodation and food services industry. The Overseas Travel Statistics, Provisional publication, which provides provisional statistics on international arrivals and departures, recorded a 99% decline in overseas arrivals to Australia in the month of April compared with one year ago.
Strength in mining exports was reported in the International Merchandise Trade, Preliminary publication for April. These results were also reflected in the April Business Impacts of COVID-19 Survey. Businesses in the mining industry were least affected (38%) by reduced demand for goods and services, and only 17% of businesses (second lowest among all industries) had registered or intended to register for the JobKeeper Payment.
The adverse impacts of COVID-19 were not isolated to Australian businesses and the economy. The ABS introduced the Household Impacts of COVID-19 Survey to capture up-to-date information on the experiences of households and their responses to COVID-19. The early April survey, which had a focus on impacts to public health, confirmed many Australians were concerned about their personal health due to COVID-19 (68%), and almost everyone was taking social distancing restrictions seriously (98%).
The mid-April survey brought to light the impacts of COVID-19 on household finances and on mental health. The results confirmed the pandemic was having significant adverse impacts on the financial and emotional well-being of Australians. Around one third of individuals reported a deterioration of their household finances over the past month. A significant number of survey participants reported feelings of nervousness (35%) and restlessness (42%), almost twice the levels found in the National Health Survey, 2017-18.
In May, new COVID-19 cases stabilised at a low level, further confirmation of economic and social impacts
At the start of May, the number of confirmed COVID-19 cases in Australia was 6,749. The number of new cases continued to decline from an average of 17 per day over the first two weeks of the month to an average of 11 per day over the last two weeks of the month (footnote 12). The economy showed signs it was stabilising, and the impacts of COVID-19 on people became more apparent.
Data from the Weekly Payroll Jobs and Wages in Australia publication showed that wages rose 0.9% and jobs fell 1.1% in late April and early May. This followed a period of substantial falls in both jobs and wages across March and April. The Business Impacts of COVID-19 Survey showed 55% of businesses were accessing government support, including wage subsidies and many had changed their business operations – by shifting to online sales or operating with a reduced workforce.
The Household Impacts of COVID-19 Survey showed three in four parents (76%) kept their children home from school or childcare due to COVID-19. Parents made changes to their work arrangements to care for their children, including working from home (38%), reducing or changing working hours (22%), and taking leave from work (13%). COVID-19 continued to impact the well-being of individuals. Loneliness was the most widely reported source of personal stress for Australians during this period.
ABS statistics which measure the economic and social impacts of the coronavirus in May will continue to be published in the coming weeks.