New data confirms that inner Melbourne’s economy has been the hardest hit region in Australia under COVID-19 restrictions.
The modelling by PricewaterhouseCoopers was commissioned by the City of Melbourne to help plan for economic recovery and support businesses.
The modelling shows the COVID-19 pandemic could reduce economic output in the City of Melbourne by up to $110 billion over the next five years, compared to previous projections.
The data shows that compared to pre-COVID19 forecasts, the City of Melbourne economy will contract by up to $23.5 billion – or 22 per cent – in 2020.
Over five years, there could be up to 79,000 fewer jobs than pre-COVID forecasts as an annual average. However, with major economic stimulus and recovery plans we can create jobs, support businesses and avoid this worst case scenario.
Lord Mayor Sally Capp said the city economy was booming before COVID-19, reaching a record $104 billion last year, which is 24 per cent of Victoria’s Gross State Product.
“Melbourne was the economic powerhouse of Australia. The scale of the economic shock being felt across the central city is unprecedented,” the Lord Mayor said.
“The modelling shows more than 22,000 jobs could be lost in our accommodation and food services sector this year alone. We can’t afford to lose our world-class food, café and retail culture.”
The Lord Mayor said Australia’s economic recovery is dependent on Melbourne’s recovery, given our city’s global reputation as a destination for investors, visitors and students.
“This new data shows that Melbourne needs urgent support from the Victorian and Australian Governments to support businesses and restore our marvellous Melbourne.
“We are working closely with the State and Federal governments to secure further support for businesses and investment for the city’s reactivation when it is safe to do so.”
The City of Melbourne thanks the Victorian Government for jointly funding this research.
The modelling accounts for the Stage 4 restrictions and assumes a slow economic recovery with prolonged public health measures in place in 2021.
The City of Melbourne is making a record $50 million investment in rate relief and stimulus packages to help our economy recover as quickly as possible.
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