NSW suffers most in payroll jobs tumble

·3-min read

Payroll jobs fell sharply in locked-down NSW in the final two weeks of July, but business investment has remained surprisingly upbeat in the face of virus restrictions across the country in recent months.

The Australian Bureau of Statistics said payroll jobs fell two per cent nationally in the fortnight to July 31, but in NSW they tumbled by 3.7 per cent.

"The latest fortnight of data coincided with increasing restrictions in the fourth and fifth weeks of the lockdown in NSW, including a pause in construction activity," ABS head of labour statistics Bjorn Jarvis said.

It also included lockdowns in Victoria and South Australia, and travel and border restrictions across all states and territories.

"With the nation's largest economy (NSW) in a protracted lockdown, Scott Morrison's botched vaccine rollout is hurting workers and small businesses, and risking our economic recovery," shadow treasurer Jim Chalmers said.

Mr Jarvis said payroll job losses in the accommodation and food services, retail trade and construction industries accounted for 44.3 per cent of job losses across Australia in the second half of July, 45.4 per cent in NSW.

ACTU president Michele O'Neil said the rates of job losses in Sydney and elsewhere were "appalling and completely unnecessary".

"We had a (JobKeeper) system in place last year which ensured that even in a long lockdown working people remained connected to their employer - the Morrison government decided to end this prematurely," she said.

The ABS said business investment rose by a stronger than expected 4.4 per cent in the June quarter, providing a much-needed boost to the national accounts that are due next Wednesday.

Economists had predicted a 2.5 per cent increase.

Total new private capital expenditure was $32.7 billion in the June quarter, 11.5 per cent higher than a year earlier.

Investment in building and structures rose by 4.6 per cent to $16.9 billion, while equipment, plant and machinery investment rose by 4.3 per cent to $15.8 billion.

Treasurer Josh Frydenberg jumped on the figures, saying non-mining investment was up six per cent and is now up 15 per cent for the year.

"(This was) the strongest growth in non-mining investment in more than 30 years," he told parliament.

The latest estimate for future investment for the 2021/22 financial year was $127.7 billion, 12.5 per cent higher than the previous forecast.

Westpac senior economist Andrew Hanlan said the survey was conducted in July and August when much of the nation was in lockdown.

"This resilience is somewhat surprising given the current backdrop," Mr Hanlan said.

The report comes a day after June quarter construction figures proved much weaker than expectations, raising concerns the economy may have stalled or even gone backwards in the quarter.

AMP Capital chief economist Shane Oliver is not convinced the rise in business investment will be enough to avoid an economic contraction in the quarter and ahead of a widely expected downturn in the September quarter.

He expects consumer spending, plant and equipment investment and government spending will likely all add to the June quarter growth result.

"This looks likely to be offset by falls in housing investment and non-residential building and detractions from growth from inventories and net exports," he said.

Reports for business profits, inventories, government finance and international trade for the June quarter are due early next week.

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting