Nothing is good if your comparison point is the Great Depression.
Treasury secretary Steven Kennedy, fronting a Senate inquiry into how the hundreds of billions in government support is being shuffled out the front door, noted on Tuesday that while the jobless rate in the 1930s rose to unprecedented heights, it had occurred over a space of years.
The coronavirus-induced shutdown of the Australian economy would likely see unemployment fall short of Great Depression levels, but a great many people would have lost their jobs in an astonishingly short period of time.
"We have never seen an economic shock of this speed, magnitude and shape, reflecting that this is both a significant supply and demand shock," he said.
This led directly into his broader point. Once the Great Lockdown is over, the economy is going to look different.
This isn't about working from home or the big increase in online shopping or how parents have a new appreciation for what school teachers endure five days a week. This is about the jobs and businesses that will disappear forever.
Treasury secretary Steven Kennedy takes a question from Labor's Kristina Keneally via the internet during a Senate hearing. Credit:Alex Ellinghausen
Just ahead of the 1990-91 recession, almost 1.2 million Australians had manufacturing jobs. More than 100,000 jobs were lost from the sector in a two-year period and they've never returned.
Despite a vastly larger economy and workforce, the number of manufacturing workers today is 25 per cent below that pre-1991 peak.
Many of those to lose work in that recession, particularly middle-aged men, struggled to ever get back into any form of paid employment. As an economy, the recession changed us.
The Great Lockdown could give us the Great Economic Reckoning that Australia has avoided because of 30 years of uninterrupted growth.
The early breezy claims of an economic "snap-back" have been dropped. It's now a slow grind.
Dr Kennedy noted a new era of entrepreneurship may evolve out of the post-pandemic world, particularly for those firms forced by necessity into new fields of endeavour.
But for many others, just getting to the other side is going to take a small miracle.
Shane is a senior economics correspondent for The Age and The Sydney Morning Herald.
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2020-04-28 10:01:02Z
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