SYDNEY (REUTERS) - Fewer Australian businesses and employees signed up for temporary welfare payments in October, a promising sign the economy is on a road to recovery following its coronavirus-driven recession, Treasurer Josh Frydenberg said on Monday (Nov 30).
Preliminary data indicates around 450,000 fewer businesses and around two million fewer employees qualified for the so-called "JobKeeper" in October than in September, Mr Frydenberg said in a statement.
The better-than-expected preliminary figures for October suggest an improvement on the 2020/21 Budget assumption, Mr Frydenberg added.
"The lower-than-forecast take-up of the JobKeeper Payment extension in October is further evidence that Australia's recovery from this once-in-a-century pandemic is well underway," Mr Frydenberg said.
Indeed, data on Wednesday is likely to show Australia's A$2 trillion (S$1.98 trillion) economy rebounded sharply last quarter after a 7 per cent slump in the three-months to June, helped by generous fiscal and monetary stimulus.
The Reserve Bank of Australia (RBA) has slashed interest rates to near zero and launched a A$100 billion quantitative easing programme to keep long-term borrowing costs low.
It is widely expected to hold rates at 0.1 per cent at its monthly meeting on Tuesday.
The JobKeeper payment, first announced in March, supported more than 3.6 million workers and around one million businesses, with payments totalling nearly A$70 billion in roughly six months to Sept 27.
In October, around 500,000 entities covering more than 1.5 million employees signed up for these payments, far less than in September, as the economy steadily reopened after controlling the pandemic.
The RBA upgraded its economic forecasts this month predicting unemployment to peak around 8 per cent from earlier estimate of 10 per cent.
The effective unemployment rate has also decreased from 9.3 per cent in September to 7.4 per cent in October, with around 80 per cent of those who lost their job or stood down on zero hours now back at work, Mr Frydenberg said.