Over the next five years, there could be up to 79,000 fewer jobs than pre-COVID forecasts in the City of Melbourne.
This is according to economic modelling commissioned by the city and carried out by business consultancy PricewaterhouseCoopers.
Economic output could drop $110-billion
The research shows the pandemic could reduce economic output in the city by up to $110-billion over the next five years, compared to previous projections.
In 2020 alone the data shows that, compared to pre-COVID-19 forecasts, Melbourne’s economy will contract by up to $23.5 billion, or 22%.
Lord Mayor Sally Capp said the city economy was booming before the virus, reaching a record $104-billion last year, which is 24% of Victoria’s Gross State Product.
Unprecedented scale of economic shock
“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.”
Capp believes Australia’s economic recovery is dependent on Melbourne’s recovery, given the city’s global reputation as a destination for investors, visitors and students.
Melbourne needs urgent support, says mayor
“This new data shows that Melbourne needs urgent support from the Victorian and Australian Governments to support businesses and restore our marvellous Melbourne,” Capp said.
“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 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 says it is making a record $50-million investment in rate relief and stimulus packages to help the economy recover as quickly as possible.