Treasurer Josh Frydenberg’s job last night was not one to be envied. With the worst in pandemic fallout yet to come, we are facing “the most severe global economic crisis since the Great Depression”.
Economic growth is still falling, expected to contract by 4.5% this year, and unemployment in Australia is projected to peak at 8% in the December quarter. It is predicted that Australia’s net debt will sit just south of $1 trillion by 2024.
Last night’s budget is a fiscal policy designed to support job growth, encourage business spending and infrastructure development, all as a means to move along economic recovery.
The industry has welcomed the budget and congratulated the government on it, praising the wage subsidy as well as the extension of the Instant Asset Write Off. Initiated during the COVID crisis, the write off means that Australian producers and manufacturers can expand production capacity, subsequently increasing jobs in the sector. The benefit of this may not be realised today but it will be a huge benefit for businesses over the next couple of years, once they are back on their feet and ready to reinvest.
Stephen Ferguson, CEO of the Australian Hotels Association said the hospitality, tourism and accommodation sectors were amongst the worst hit by the pandemic, with lengthy shutdowns impacting more than 900,000 workers across the whole sector. The hotels are ready to open for business.
“They have COVIDSafe plans in place and take their health obligations extremely seriously - we welcome the emphasis on jobs in last night’s Budget and look forward to playing our role in getting more Australians safely back to work,” he said.
“One great thing about jobs in our hard hit sector is that can be created ‘instantly’ through demand – you don’t need to wait for a shovel to hit the ground.”
The JobMaker Hiring Credit – a $1.2 billion wage subsidy – starts for new hires from today and will partially subsidise the wages of young employees. Employers will be able to claim $200 per week for every employee (aged 16-29 years) hired from today and $100 per week for every employee aged between 30 and 35 years.
The $1 billion investment in skills training – for the likes of up and coming chefs and hotel managers - is also welcome.
Responding to the budget announcement, Nick Tindall, General Manager of LAUNDY Hotels said: “It has been a devastating year for the young workforce who are the welcoming face of our venues and the ones who keep them running so smoothly. LAUNDY Hotels have had to reduce our workforce by 10% and the road to recovery will be long. We certainly are not out of the woods yet. The federal government’s wage subsidy is very welcome.
"LAUNDY Hotels will be able to start hiring the young people we rely upon, knowing that we will have that economic support.”
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