Pandemic Covid-19 has forced 70% of businesses in the hotel sector to reduce their staff hours and 43% to fire workers or put them on unpaid leave, new data shows.
The Australian Bureau of Statistics has release new data shows the impact of a pandemic on business, based on a survey of 3,000 companies in the days after the government was tough limitation of social distance announced on March 29.
Two-thirds of businesses in all sectors report receiving income or cash flow due to Covid-19.
Approximately the same number reported that they had decreased demand.
Two out of five businesses say they have changed the way they deliver goods or services, one third say they have renegotiated their leases, and one in four has postponed loan payments.
About one in 10 says they have stopped trading altogether. In 70% of cases, this is caused by Covid-19.
Harassment of Australian workers is extensive.
Nearly half of the businesses that are still traded report making changes to their workforce in the past two weeks because of Covid-19, including temporary reductions or increases in working hours, changes in work locations, or staff leave.
Reduced working hours are reported by 25% of businesses with 19 or fewer employees, 41% of those who have 20-199 workers, and 34% of those who have 200 or more employees.
There is no clearer impact than in the hospitality sector.
Around 78% of the accommodation and food service businesses have made changes to their workforce, including 70% who have temporarily reduced working hours.
Around 43% said they had placed staff with unpaid leave, including detaining them, and 29% said they had placed staff with paid leave.
This sector accounts for around 8% of Australia’s work.
The numbers, though not unexpected, paint a vivid picture of the impact of Covid-19 on Australian business.
On Monday Westpac economist warns Australia’s gross domestic product will contract by 8.5% in the June quarter, followed by a contraction of 0.6% in the September quarter.
“Overall, the economy is expected to contract by 5% by 2020,” said Bill Evans, chief economist at Westpac.
“Everything is the same, this growth forecast will be consistent with the unemployment rate peaking at 17% in the June quarter and settling around 9% at the end of the year.”
Westpac economists estimate the impact of Covid-19 will be very severe on New South Wales and Victoria, because of their dependence on tourism and international students.
NSW is predicted to record its first recession since 1990-91 and Victoria is facing a significant downturn and is unlikely to “prevent what forms a big hit from the outbreak of Covid”, mainly due to its dependence on tourism.
ABS data also shows dramatic changes in the health sector workforce and social assistance. About 63% of businesses made changes to the workforce because of Covid-19, including 44% who reported they had reduced staff working hours, 42% who said they had changed the location of their staff, and 17% who had put staff on unpaid leave.
About 9% of the healthcare or social assistance business said they temporarily increased work hours.
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