June 2020 - Education Geographics

Monthly Archives: June 2020

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Job recovery was underway in May following initial hit in April May 2020

Jobs Recovery Was Underway In May Following Initial Hit In March/April

Category:Health,Labour Market Tags : 

The recovery in many jobs was well under way in May. It’s been most pronounced in those hit first in March/April, working in hospitality, young home buyers, young casual workers also studying at TAFE and this is all to the good.

The downturn however continued in May among farming and rural communities, especially fishing (think lobsters in cargo holds of international tourist flights). This has impacted coastal and many rural communities.

The overall picture from March to the end of May shows mainstream suburban families (married, middle aged, with a mortgage and kids at school, two jobs that they really need, and going to church occasionally) to have been much less affected by Covid or by the follow-up lockdowns – down about five percent. These are the groups which weren’t picked up in the polls before the last election and which re-elected Scott Morrison as PM.  

The groups in deepest trouble (ten percent plus loss over jobs) over the period March to May were – despite a recovery in May – still the workers in casual hospitality and arts & rec jobs (agnostics, twenty somethings, living in small rental units, single, agnostics, no kids, Green voters).

Link to Map

 Jobs Recovery was underway in May following intial hit in March / April.

So, good is down only five percent and getting better slowly. Bad is ten percent and getting worse slowly. Spatially, Tasmania looks pretty awful, as do many rural and coastal communities, but the really horrible bits on the map are the inner-city suburbs, particularly in Melbourne and Sydney, where Covid cases have been most concentrated.

Because the jobs lost in many cases have been second or third casual jobs and less well paid, the impact of jobs lost to the economy has been a bit overstated and has actually increased average incomes per job in many suburban areas, especially with large public sector payrolls.

This is, however, pretty cold comfort, for those relying on Government handouts and counting down to the end of September.

What was the real rate of unemployment in May? The short answer is 11.5 percent. This is obtained by maintaining the pre-Covid lockdown participation rate at the March level of 66.2 percent and applying this to the Civilian population 15 years and over, producing a potential workforce of up to 13, 770,061 in May. The combined numbers of officially unemployed and those who dropped out was 1,579,639. We used original or unadjusted figures as seasonal adjustments have become overwhelmed by Covid lockdowns and only original figures are used spatially for smaller areas. The original unemployment figure was marginally higher at 11.7 percent and 12.1 percent respectively in January and February 1993.

The figure of 11.5 percent also resonates with the new and more immediate ABS series on Weekly Payroll Jobs and Wages, which shows 5.6 percent of main jobs were lost between March 14 and the end of May and the official March unemployment rate was 5.6 percent in March. The two figures sum to 11.2 percent.

This means the current unemployment rate is as bad now as it was during the worst of the recession in the early 1990’s. The unemployment figure then was marginally higher at 11.7 percent and 12.1 percent respectively in January and February 1993.

The current figures for the one touch payroll data have been recovering slowly from the initial impact of the Covid jobs lockdown in early April, and this 11.2 percent hybrid figure is likely to continue (barring a second wave starting off from Victoria) at least until the Government begins to wind back JobKeeper and JobSeeker in September.

The realistic figure for unemployment rates at that time will be determined by whether the rate of recovery exceeds the rate at which those now on JobKeeper or JobSeeker join the ranks of those actively seeking work and satisfying the ABS definition of being unemployed.

The official ABS labour market unemployment rate is now pretty meaningless, as participation rates will tend to decline with relatively older and younger workers dropping out of the labour market.

In fact, the first sign of a recovery in a recessed regional labour market can be an interim increase in the local unemployment rate, as formerly discouraged workers are encouraged to seek work by becoming officially unemployed on a temporary basis, while actively hunting for a job and hence immediately boosting participation rates and then growing employment in the longer term.

So the most useful indicators you should be watching for in coming months are total jobs lost and gained by region and accompanying movements to participation rates.

 

Text by John Black, founder of ADS and EGS. Maps by Dr. Jeanine McMullan, CEO of Health Geographics.

 


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Eden-Monaro by-election 2020

Category:By-Elections

By JOHN BLACK, Founder of ADS

The Eden-Monaro by-election will be held on July 4. With a week to go, Labor’s Kristy McBain is the bookies’ favourite on $1.70 to win, with published robo-polls giving her 53 percent of the two-party preferred (2PP) vote.

Despite trailing in the robo-polls and with Sportsbet paying $2.25, I think the Liberal candidate Fiona Kotvojs is pretty good value for money if you like a flutter. There are a few reasons for this, but first some background.

Eden-Monaro is pretty close to being Australia’s version of Magic Town, named after the 1947 movie featuring a fictitious version of one of the original United States polling companies. The pollster – played by James Stewart – is obsessed with finding a small town which is a perfect demographic and political sample of the USA. This meant it could be milked cheaply for perfect poll results on everything from toothpaste preferences to voting intention.

With similar demographics to Australia, Eden-Monaro tends to vote like Australia and return the same result: and this means the party winning Eden-Monaro tends to also win a majority of seats and form the Government.

Mike Kelly first won the seat for Labor when Labor’s Kevin Rudd won the 2007 election. He won it again in 2010 when Labor also held Government, and he lost it in 2013, when Labor lost Government. So far, so good for Eden-Monaro’s reputation as Australia’s political Magic Town.

But then the popular Dr Kelly stood again for Eden-Monaro in 2016 and won, despite Labor losing the national election narrowly to the Coalition. He eroded the Eden-Monaro’s Magic Town reputation further in 2019, by holding the seat on 50.9 percent 2PP vote, despite Labor’s failure to regain Government.

When we look into the demographics of Eden-Monaro, we see it’s very similar to Australia, in terms of its socio-economic indicators which cover job status, education status and income. It also contains some urban overspill from Canberra, some farming and fishing communities and a slice of tree-changing and sea changing retirement communities.

Click to view demographics for Eden-Monaro

The Eden-Monaro by-election will be held on July 4.

The differences between Eden-Monaro and Australia seem minor but explain why the seat went against the trends in 2016 and 2019, sticking to Mike Kelly as a well-regarded political identity.

Compared to Australia the seat, on average contains more farmers and farm workers and a disproportionate number of retirees. Our demographic profiling of elections back to 1966, shows farm workers and retirees have a weak class vote and are more inclined to cast a large personal vote for any effective MP seen to be doing a good job.

We did several national demographic models of the 2019 election and on the one we chose, Mike Kelly polled 6.6 percent more than the model predicted.

With a standard error of estimate of 4.5 percent, this was a strong performance and history tells us that when a popular sitting member like this retires, their personal vote tends to be redistributed back to the opposing party, especially when that party is nominating the same candidate.

In the case of Eden-Monaro, that party is the Liberal Party and their candidate is again, Fiona Kotvojs. It’s important to bear in mind we model 2PP votes, so one candidate’s overperformance, is also their opponent’s underperformance.

So, it’s statistically safe to say Kotvojs would have won Eden-Monaro in 2019 with up to 55 percent of the 2PP vote against a less effective sitting MP than Mike Kelly. Hence my tip earlier on the value for money bet.

But we’re now in 2020 not 2019. Relevant factors to consider since 2019 include.

Favouring Labor:

Anthony Albanese is now the Labor Leader, not Bill Shorten. Both men were on similar levels of satisfaction – 41 percent – at similar stages of the election process, but Shorten was on a dissatisfaction score of 49 percent before the last election, compared to Albanese’s 38 percent.

Scott Morrison performed below par during and after the bushfires which devastated the east coast of the electorate over Christmas and this region was just getting back on its feet when it got whacked again with job losses from the Covid lockdown.

Labor now appears to be running an effective postal vote campaign in 2020 compared to 2019, when it ran no campaign at all. This is a sleeper for Labor.

The National Party and the Shooters are reportedly up to some preference allocation tricks in Eden-Monaro to disadvantage the Liberals. Even if true, I suspect these factors can be disregarded. Voters have more important things to worry about at the moment.

Favouring the Coalition:

Scott Morrison has performed above par during and after the Covid-Pandemic and lifted his personal pre-2019 election satisfaction score from 46 percent to 66 percent and his Better PM rating from 47 percent against Bill Shorten to 56 percent against Anthony Albanese. Tick one for the Liberals. But this is a pretty big tick, especially in a crisis such as we’re now facing, when voters tend to rally behind the Government of the day.

The big group relatively unimpacted by the Covid jobs Lockdown is of course public servants, and Eden-Monaro contains a lot of these, due to some fast-growing, high-SES, urban overspill south of Queanbeyan and this included some swings to the Coalition in 2019. I suspect this is a sleeper for the Coalition.

This leaves us to consider the Robo-polls now putting Labor’s Kristy McBain on 53 percent of the 2PP vote in Eden-Monaro. If you were one of the candidates, you’d rather be McBain on 53 percent, than Kotvojs on 47 percent.

But other pre-election Robo-polls overestimated Labor’s 2019 vote by three percent at the last election by oversampling IT-savvy, highly-paid professionals and younger highly-mobile, agnostic, Tertiary students, with strong dependence on social media, who love to fill in online media surveys and polls. These were the groups swinging to Labor in 2019. These are the groups now most impacted by the Covid Lockdowns.

The robo-polls in 2019 also under-sampled working families with two reasonably secure jobs, a mortgage to pay off and dependent school aged kids to look after, and they also under-sampled church goers, especially those on the fringes of our major cities. These are the groups which swung to Scott Morrison and the Coalition and they are the group least impacted by the current Covid Lockdowns.

The big unknown here are how the public votes during the Covid pandemic and associated jobs lockdown and none of us will know this for sure until we get the results on Saturday night.

But on the evidence, Fiona Kotvojs is good value at $2.25 for a win. Very good value.

MAP NOTES:

We can tell from the online interactive map that the areas hit hardest in Eden-Monaro by the jobs’ lockdown in March/April, were those showing the strongest signs of recovery in May. You can track the impact of the changes by clicking on the stages from 1 to 5.

We also include map layers showing swings and votes at the 2019 election. The votes provided are based on modelling of all the votes cast in Eden-Monaro, not just the booth votes which are becoming increasingly irrelevant, due to major increases in pre-poll voting.

 

Comments from John Black, founder of ADS and Education Geographics and map from Dr Jeanine McMullan, CEO of Health Geographics.