Digital art for economy support
Digital art for economy support

Huge amount Aussies saved during the pandemic

Households and businesses have amassed a $200 billion savings treasure chest that will spare Australia from the feared economic "cliff" when coronavirus supports end in March.

The economy is expected to power though the end of temporary government schemes, including JobKeeper and the JobSeeker COVID-19 supplement thanks to the high levels of cash banked by families and the private sector during the pandemic.

New figures show that ­despite the recession, household deposits have increased by almost $113 billion, or 11.4 per cent, from the start of January to the end of ­November 2020.

New figures show there are more jobs available now than pre-COVID with retail, recreation, accommodation and food services driving the boom. Picture: NCA NewsWire / Gaye Gerard
New figures show there are more jobs available now than pre-COVID with retail, recreation, accommodation and food services driving the boom. Picture: NCA NewsWire / Gaye Gerard

 

Treasurer Josh Frydenberg said government support had helped Australia avoid a “fiscal cliff”. Picture: NCA NewsWire / Gary Ramage
Treasurer Josh Frydenberg said government support had helped Australia avoid a “fiscal cliff”. Picture: NCA NewsWire / Gary Ramage

At the same time non-financial business deposits have increased by almost $104 billion.

A combination of less spending due to restrictions and health concerns, and the government's direct temporary emergency support filling the income gap have fuelled the savings buffer.

In other good news, the Australian Bureau of Statistics on Wednesday revealed the number of vacant jobs in the country increased by 23 per cent in the November 2020 quarter, meaning there were now more positions available than pre-COVID.

Recreation, accommodation and food services, and retail have driven the jobs boom.

Treasurer Josh Frydenberg said the $142.6 billion in government support already out the door and tapering the JobKeeper and JobSeeker payments had helped Australia avoid a "fiscal cliff".

Shoppers in Sydney CBD. Picture: NCA NewsWire / Gaye Gerard
Shoppers in Sydney CBD. Picture: NCA NewsWire / Gaye Gerard

"With an additional $200 billion sitting on household and business balance sheets compared to the start of last year there is a huge sum of money available to be spent across the economy helping to create jobs and maintain the momentum of our economic recovery," he said.

Mr Frydenberg said Australia performed "better" on both the health and economic crises caused by the pandemic than "almost any other nation".

"With the JobMaker Hiring Credit, personal income tax cuts, investment incentives and a range of other measures our economic comeback will be continue," he said.

Treasury modelling released on Thursday will show the government support rolled out during the worst of the pandemic will lead to economic activity, or real GDP, being 5 per cent higher this financial year compared to what it would have been without help.

The outlook is also better for the 2021-22 financial year, with GDP forecast to be about 4.5 per cent higher due to the extra economic support.

Originally published as Huge amount Aussies saved during the pandemic



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