Finance Minister warns of worsening unemployment situation in NZ this year amid pandemic

August 6, 2020

Grant Robertson says the September quarter will see the heaviest impact on employment.

While unemployment statistics showed a slight improvement yesterday, Finance Minister Grant Robertson says the worst is yet to come amid the Covid-19 pandemic.

"We've been saying that for months the September quarter will be the one where we see the heaviest impact around job loss," he told TVNZ1's Breakfast this morning.

"I absolutely accept that in a one in 100 year pandemic that we are going to see people who are out of work for a period of time, the opportunity is now there for them to retrain free in many sectors so I believe we are doing what we can but we constantly look for new ways to support people."

Yesterday, Stats NZ revealed unemployment in New Zealand had actually dropped to four per cent .

"What these numbers that came out yesterday mean, is that the head start that New Zealand got compared to the rest of the world by having gone hard and early on those health policies, it means that we are in a much stronger starting point, much stronger position," Mr Robertson said.

"But yes, the rest of the world as you can tell is still facing a growing epidemic here and we have to be prepared for the consequences of that."

But in a Covid-19-related anomaly, New Zealand’s unemployment rate has actually fallen.

However, while the unemployment numbers looked better, according to Stats NZ they only improved because to be considered unemployed, a person must be actively looking for work, which many could not do during the lockdown.

Those out of work amid the Covid-19 pandemic are eligible for several benefits though.

The Wage Subsidy Scheme pays $585.50 a week and is passed down to each full-time employee, originally if the business proved a 30 per cent loss of revenue, and 40 per cent for the extension. The scheme ends September 1.

Meanwhile, people who lose their job due to the pandemic have the option to apply for the Government's Income Relief Payment of $490 a week for 12 weeks.

The scheme ends in November, but for those unable to find work they can then move onto JobSeeker support payments, starting from a base of $250 a week. People on the JobSeeker benefit must be actively seeking work.

It’s not good news however, with NZ’s under utilisation rate seeing the biggest rise since 2004.

There are also other forms of Government support for businesses, including the Tourism Recovery Fund and the Small Business Cashflow (Loan) Scheme.

"We've got to make sure we're supporting people to get back into work, start their own business, get back into the economy," Mr Robertson said.

"We're going to keep doing as much as we can to support people into work."

Mr Robertson said the Government's $15 billion to help create jobs in Budget 2020 was rolling out now, with forecasts of around 300,000 over the four-year period of the Budget.

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