1.3 State and territory impact

The impact of the COVID-19 pandemic on the Australian labour market at the national level has also been evident across the states and territories. Since March, employment has fallen in the majority of jurisdictions, while the unemployment rate has risen in all states and territories.

Some jurisdictions have been more severely affected than others due to a range of factors, including ongoing COVID-19 cases, each jurisdiction’s industry composition, its demographics (population size and age structure) and differences in the way each state and territory has managed the pandemic.

Not surprisingly, reflecting the outbreak of COVID-19 cases in Victoria from late June and the subsequent restrictions, labour market indicators in Victoria remain well below pre-COVID-19 levels and are currently faring more poorly than in other states. For instance, employment in Victoria remains 141,100 below the level recorded in March, while the unemployment rate has risen to 7.4% in October, well above the 5.2% recorded in March.

Encouragingly, employment in Victoria rose by 81,600 in October, the largest monthly increase on record, as restrictions in the state began to ease. Moreover, it is likely that labour market conditions in Victoria will continue to strengthen following a further relaxation of restrictions in November.

Figure 9: Change in employment between March 2020 and October 2020, by state and territory

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This graphic illustrates that some states have been more severely affected than others due to a range of factors, including ongoing COVID-19 cases, each jurisdiction’s industry composition, its demographics (population size and age structure) and differences in the way each state and territory has managed the pandemic.  Not surprisingly, reflecting the outbreak of COVID-19 cases in Victoria from late June and the subsequent restrictions, labour market indicators in Victoria remain well below pre-COVID level

Source: ABS, Labour Force, Australia, October 2020, seasonally adjusted data.

On the other hand, labour market conditions in Western Australia (where there has been no community transmission since 11 April) have rebounded strongly since the trough in May. Employment in that state has increased by 89,300 (or 7.0%) over the period, after declining by 95,400 (or 7.0%) between March and May.

Against this stronger backdrop, Western Australia’s unemployment rate has fallen by 1.5 percentage points since May, to stand at 6.6% in October. This is the second lowest unemployment rate of any state, although still well above the 5.4% recorded in March.