The construction industry should benefit from the extension of JobKeeper scheme, market watchers say.
Denita Wawn, CEO of Master Builders Australia, said building and construction is the industry with the most businesses registered for JobKeeper — 98% of the industry is comprised of small businesses.
"There's no doubt that JobKeeper continues to be a lifeline for thousands of small builders and tradies as well as many in the building supply chain. The continuing easier accessibility for sole traders to access the scheme is also important," she said.
Wawn said this will complement the impacts of the HomeBuilder scheme and other similar grants in keeping the construction industry active.
"As the government recognises, the massive contraction in demand that we are experiencing is due to the restrictions on economic activity imposed to save lives, and therefore more successful stimulus measures such as HomeBuilder will be required to underpin recovery," she said.
Softening the economic blow
Peter Koulizos, chairperson of the Property Investment Professionals of Australia, said the extension of the JobKeeper program will help moderate the economic impacts of the COVID-19 outbreak.
"We need to accept that the economic impact of COVID19 is going to be significant. However, if the various stimulus initiatives and financial support packages hadn't been implemented, then the fallout would have been severe," he said.
Koulizos believes that Australia might not be able to avoid a recession, but stimulus programs will help the economy avoid long-term risks.
"In essence, these measures are providing an economic airbag to help slow down, and soften, the impact that we all know is coming," he said.
Koulizos said the extension of the wage subsidy extension will also help the finances of many Australians affected by the outbreak. He said the tightening of JobKeeper eligibility criteria would mean that the people who really need support will be targeted.
"The extension, as well as the continuance of mortgage repayment pauses, will benefit homeowners, landlords and tenants who continue to need financial support over coming months," he said. "It also gives people time to breathe and prepare — rather than starting to panic about how to financially survive post-September."
Changes to JobKeeper and JobSeeker
The federal government announced that JobKeeper and JobSeeker will be extended beyond their deadline in late September. Under the changes, JobKeeper payments and JobSeeker coronavirus supplements will be reduced.
From 28 September, JobKeeper payments will be cut from a flat $1,500 a fortnight to $1,200 for full-time workers. For part-time workers, the payment will be reduced to $750 a fortnight.
Similar cuts will be levelled on the JobSeeker coronavirus supplement. JobSeeker recipients who are receiving roughly $1,100 every fortnight will be getting $815 after 28 September.
Treasurer Josh Frydenberg said eligibility requirements will be reinforced by the end of September to reassess which businesses and organisations meet the turnover test.
"As the economy gradually improves, Treasury expects that the number of JobKeeper recipients will reduce substantially, with around 1.4 million people remaining eligible in the December quarter, 2020 and 1 million in the March quarter, 2021," he said.
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