The latest Victoria lockdown smashed the hospitality and recreation sectors

The recent lockdown in Melbourne had a massive impact on jobs in hospitality and recreation sectors in Victoria while across the nation the latest data shows that although jobs have dropped a bit due to seasonal factors, they remain mostly steady due to government support.

Since the entrance of Covid into our lives, the bureau of statistics has realised that the monthly labour force figures are too slow at showing how the economy is going. As a result they have worked with the ATO to produce a weekly index of payroll job numbers.

The latest figures show that over the last week in May and the first week of June jobs around the country fell nearly 1%:

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But while that fall is quite sizeable – equivalent to around 130,000 people losing their jobs – we need to be careful about jumping at shadows.

For a start these figures are subject to pretty large revisions, and secondly they don’t account for seasonal factors.

Winter is always a slower time for job growth – agricultural jobs especially fall off at this time; so too do many hospitality jobs (which were already struggling).

When we compare this year with last year, it is clear that things are a lot better. Since March this year, things have been pretty steady:

If you can’t view the graph click here

The number of payroll jobs is around 2,3% above what they were when the pandemic hit in March last year, and 6.7% above the beginning of June last year. Not only was there the usual winter drop off in work, but the lockdowns and impact of the pandemic were still very much in the acute stage.

But while we might be able to argue that a slight drop-off in jobs is no real cause for concern at this point, we cannot pretend that the lockdown in Victoria didn’t hurt.

As ever, the lockdown absolutely smashed the hospitality and recreation sectors.

In New South Wales for example, jobs in the accommodation and food services industry fell just 0.4% between week ending 22 of May and the end of the first week in June; in the same period they fell 10.2% in Victoria:

If you can’t view the graph click here

The arts and recreation industry also saw a massive fall in jobs well out of step with the rest of the nation.

These two industries have consistently been the ones most hurt by lockdowns and travel restrictions – and crucially they are industries with high levels of casual and part-time workers.

There is however one other sector that has been hurt even worse. And while this sector is not technically in the accommodation or recreation industry, it is utterly crucial to both – air travel.

While jobs in the accommodation sector were hit harder in the first weeks of the pandemic last year, they have at least recovered somewhat, unlike those in air travel:

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Since the pandemic, the air travel sector has lost a third of it jobs – and restrictions such as occurred this week for travel from Sydney are going to do nothing to improve the situation.

The construction industry has also shown the impact of government decisions – but in a more subtle way.

There are now roughly the same number of jobs in construction as were prior to the pandemic, but the type of work is greatly different. It highlights the focus of the Morrison government’s response.

Since the pandemic the number of jobs in construction of major engineering projects has fallen by 11%, but those in “building” (ie mostly housing construction) have risen 6%:

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It’s an indicator – as I noted last week – that the Morrison government has focused on private households to spur construction work rather than using the recession to fast-track public infrastructure projects.

And yet the public sector has still played a major role in keeping overall employment steady.

The biggest sector that has seen strong employment growth over the past year has been public administration – up 16% since the pandemic:

If you can’t view the graph click here

Given the public administration makes up nearly 5% of all employment (and roughly twice as many as those working in building construction) it highlights that while the overall number of jobs is holding up, it is off the back of a massive surge of public sector work and public subsidy of housing construction.

The recovery remains very much one fuelled by the public sector.