Alan Kohler (Weekend Australian Business Review, 20/6/20) has been talking to the hospitality industry.
Right now, 3.3 million people and their employers are being supported by JobKeeper at a cost of $10bn per month. ... JobKeeper (ends) September 27 ... there's a very large and very specific problem with the deadline: the four square metres rule.
Kohler suggests the only way this can be lifted is if a vaccine exists, and if the rule is still in place after 27 September hospitality businesses go into receivership en masse and hundreds and possibly millions of people will be thrown out of work.
An economic catastrophe would ensue - an industry that represents 7.2 per cent of GDP and more than 10 per cent of the workforce would close. ... each restaurant that keeps to four square metres per patron would need each diner to spend at least $2500 per sitting in Sydney and $1500 in Melbourne. ... It's not possible. ... For another month the waiters, chefs and dishwashers thus unemployed would get the JobSeeker supplement of $550 per fortnight ... so they would survive (until) October 27 at which point they would have to get a job or cut expenses to $40 a day.
Once again, highly unlikely. Now it gets nasty:
If banks end mortgage repayment forbearance in September as planned, their houses would have to be sold. Nobody in the restaurant business, or tourism, would be able to service a mortgage - owners, chefs, waiters, nobody. ... Every mortgaged house ... would be listed for sale in October ... (leading to) ... a property collapse and financial crisis to go with the spike in unemployment and double-dip depression.
Bear in mind JobKeeper and JobSeeker are both bankrolled by the taxpayer of which, in this scenario, there are fewer and fewer.
... it must be likely that the state and federal chief medical officers will advise their governments not to allow people to mingle until there's a vaccine ... (and ) ... Prime Minister Scott Morrison and Treasurer Josh Frydenberg are desperate to stop the budget leaking $10bn per month ...
So what's the answer?
... my guess is that Australia won't be the only country giving up on fighting the pandemic with social distancing before the third quarter is out. ... we are heading into a new world where a lot more people get sick and die than at any time since the 19th century ...
Especially since Australia relatively speaking has barely been touched. No: you never did throw the baby out with the bathwater.
Right now, 3.3 million people and their employers are being supported by JobKeeper at a cost of $10bn per month. ... JobKeeper (ends) September 27 ... there's a very large and very specific problem with the deadline: the four square metres rule.
Kohler suggests the only way this can be lifted is if a vaccine exists, and if the rule is still in place after 27 September hospitality businesses go into receivership en masse and hundreds and possibly millions of people will be thrown out of work.
An economic catastrophe would ensue - an industry that represents 7.2 per cent of GDP and more than 10 per cent of the workforce would close. ... each restaurant that keeps to four square metres per patron would need each diner to spend at least $2500 per sitting in Sydney and $1500 in Melbourne. ... It's not possible. ... For another month the waiters, chefs and dishwashers thus unemployed would get the JobSeeker supplement of $550 per fortnight ... so they would survive (until) October 27 at which point they would have to get a job or cut expenses to $40 a day.
Once again, highly unlikely. Now it gets nasty:
If banks end mortgage repayment forbearance in September as planned, their houses would have to be sold. Nobody in the restaurant business, or tourism, would be able to service a mortgage - owners, chefs, waiters, nobody. ... Every mortgaged house ... would be listed for sale in October ... (leading to) ... a property collapse and financial crisis to go with the spike in unemployment and double-dip depression.
Bear in mind JobKeeper and JobSeeker are both bankrolled by the taxpayer of which, in this scenario, there are fewer and fewer.
... it must be likely that the state and federal chief medical officers will advise their governments not to allow people to mingle until there's a vaccine ... (and ) ... Prime Minister Scott Morrison and Treasurer Josh Frydenberg are desperate to stop the budget leaking $10bn per month ...
So what's the answer?
... my guess is that Australia won't be the only country giving up on fighting the pandemic with social distancing before the third quarter is out. ... we are heading into a new world where a lot more people get sick and die than at any time since the 19th century ...
Especially since Australia relatively speaking has barely been touched. No: you never did throw the baby out with the bathwater.
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