Analysts at Goldman Sachs offer their take on the Australian labor market situation, in the face of the coronavirus outbreak.
“Australia’s effective unemployment rate is adjusted for hours worked and labor-force participation.
This real rate of unemployment is likely to hit 19% by the middle of this year.
Many workers will be nominally employed under the government’s wage subsidy program.
But working very few hours.
Others will leave the labor force.
Will boost part-time work and voluntary labor force exits.
And significantly undermine the usefulness of standard measures of underemployment and underutilization.
Expect an associated slowing for wages growth.”