Australia’s economy shrunk 1.9% in the September quarter. They attribute this contraction to COVID-19 lockdowns in major States and a weakening labor market. Spending in New South Wales, Victoria, and the ACT declined by 8.4 percent during the September quarter but grew by 0.7 percent in the rest of Australia.
The lockdowns made it next to impossible for anyone to go anywhere. The local governments set curfews, and police erected checkpoints on highways. Public transport reduced service levels, and people kept to their homes as much as possible.
Despite the lockdown, some non-essential services and businesses tried to remain operational. Food and clothing stores remained open, but most service-related industries shut down. With so few people outside, the labor market contracted.
As the economy shrank, more people got laid off. When the Labor Department noticed a decline in employment and a drop in wages, they released COVID-19’s progeny to carry out its dirty job.
The financial damage of the lockdown is beginning to be felt
The damage COVID-19 inflicted on the Australian economy will take time to repair. Consumers spend less after living on savings for so long, and businesses are laying off workers as sales plummet.
The next few years will be challenging to recover from. More significant problems remain in the pipeline, and resources are being wasted. But the damage inflicted by COVID-19 is already clear as work begins on other new lockdowns.
In light of this disastrous economic aftermath, government officials should consider the economic impact before planning future lockdowns. It may be wise to consider a gradual process, evaluating the effects of each lockdown before they start another one.
There will likely be more lockdowns in the future. Still, hopefully, governments will take steps to secure the safety of their citizens while minimizing the economic damage as much as possible.
Every life matters to the government, so they should consider the human toll before committing to an action.
One of the reasons these lockdowns were so devastating is because they occurred in several States at once instead of just one. People from different locations were suddenly on a one-way street without knowing where they were going. Many of the lockdowns occurred in its aftermath, and people struggled to make sense of it all.
It looks as if the coronavirus is here to stay
Let’s face it; the coronavirus isn’t going anywhere anytime soon. It’s here to stay, and governments are going to have to deal with it.
It’s not easy to contain it, and it’s not convenient. But with the lockdowns continuing, it will be a while before we can get the economy back in order. It’s also possible that the economy will continue to suffer as more lockdowns are announced. As a result, more people have been laid off, and more resources are being wasted.
But it appears that the damage is done, and the worst is behind us.
Hopefully, we can learn from the experience and continue to improve on the ways governments handle the situation.
The need for COVID-19 lockdowns is unfortunate, but it’s necessary for safety. The lockdowns force us to take steps to prevent further transmission of the virus. The lockdowns are a vital part of the government’s response to the situation.