The long-term impacts of COVID-19 on the Australian economy

As Australia continues to weather the COVID storm, it’s easy to only focus on the present. While we remain in the first phases of economic shock, it’s fair to say that the effects of COVID-19 will be widespread and felt for a long time to come.

Workforce and industry

COVID-19 has had a heavy impact on Australia’s employment landscape. Recent figures indicate a 7.4% unemployment rate, and while job losses are hitting families hard in the short-term, these workforce shifts are also shaping how industry and employment will look in the future. Certain sectors, like aviation and tourism, might never be the same again. Increasingly, organisations are being forced to make structural changes – operations are being moved online, and businesses are automating processes typically performed by humans. Now that these difficult changes have been made, it’s likely some of them will become permanent even after COVID. This is particularly true in the hardest-hit sectors of hospitality and retail, where businesses will need to transform to survive, changing the landscape of these industries for the long-term.

Globalisation, trade and population growth

Short-term travel restrictions and disruption to the global supply chain have driven governments around the world to reassess their stance on globalisation. Production of some goods will be moved onshore, particularly those that are deemed of national significance like healthcare products, and there will be more slack built into supply chains to account for reduced reliability. Most significantly, Australia will feel the impact of a vast reduction in migration, with the Prime Minister estimating that 34,000 migrants will arrive in the country in the year to come – a staggering drop from the 533,500 who arrived in 2019. A lack of migrants over the longer-term will result in population decline and a reduced workforce that could have an enduring economic impact on the healthcare, tourism, housing, and agricultural sectors.

Education and skills

The pandemic will have a lasting effect on a generation of learners. International students aren’t arriving, domestic students are learning over Zoom and tertiary institutions are losing money and staff at a rapid rate. A crisis in higher education could have long-term impacts on the structure of the sector and some institutions may not survive. But it isn’t all necessarily bad news. Rapid, innovative training courses could begin to take the place of the traditional Bachelor’s degree, as school-leavers get the skills they need to enter a fast-evolving workforce and keep Australia competitive in key industry sectors.

Australia is going through a difficult time, but it’s important that we keep our attention focused on long-term growth and recovery. If you’d like to discuss how best to set yourself up for the future, please don’t hesitate to get in touch.

COVID-19 Crest Office Changes

As such, we have implemented a range of measures to ensure our staff remain safe within the office environment and to adhere to the current isolation rules, as recommended by the Government.

Specific measures taken include limiting meetings to phone and online appointments and closing our offices to clients and the general public.

We have also upgraded our remote office capabilities and a number of staff are already working from home. Furthermore, we have separated our office staff into two separate teams to help limit the risk of infection.

Crest Financial Services will continue to provide a high level of advice and services that our clients expect and we would encourage you to call us if you have any concerns or questions.

As always, we are here to help and we hope you and your loved ones stay safe at this time.

Sincerely,
Crest Management & Staff
Ph: (02) 4929 2552
Email: [email protected]

COVID-19 Crest Updates

As COVID-19 continues to challenge society on several levels, the Crest team are working to keep clients updated and provide continued service. While doing this, Crest are actively managing how we engage with clients to protect our team and the health and safety of our community.

Through this crisis, global markets have experienced unprecedented volatility. While we understand the concerns and the impact these events have had on individual portfolios, we are encouraging everyone to remain calm and continue focusing on their long term goals.

Please click here for a recent update from Shane Oliver (Senior Economist, AMP Capital) to assist your understanding and provide a perspective on the changing economic situation.

We understand that our clients will be subject to significant media hype surrounding each market move. Going forward, markets are likely to remain volatile until investors are convinced that the worst of the COVID-19 has passed. Once volatility falls, markets will most likely rally, although the timing is somewhat difficult to determine at this point.

We encourage you to try not to feel isolated by everything that is going on and always remember that we are here continuing to support our clients, as we have done during previous downturns.

The Crest team hope you and your family remain safe and healthy during this time.

If you have concerns or would like to discuss your personal situation, please do not hesitate to contact our office.