“It’s a middle-class disaster,” former NSW MP and now Taylor Fry director Pru Goward said. “The impact of this has been much more likely to be felt in middle-class households than in poor households and that is a very big difference between what we’re seeing now and the Great Depression of the 1930s.”
Taylor Fry principal Alan Greenfield said people earning medium-to-high incomes were the most vulnerable to the pandemic as losses incurred by salary cuts or reduced working hours were disproportionate to government payments such as JobKeeper.
“You’ve seen in the last few weeks, thousands of jobs lost in accounting, legal and professional services firms,” Mr Greenfield said. “People on incomes in the $50,000 to $100,000 range are the ones likely to have the least buffer but biggest financial fall in income.”
Northern suburbs including Crows Nest, Cremorne and Neutral Bay as well as eastern suburbs such as Paddington and Surry Hills are marked red, signifying “extreme impact”.
These suburbs have a large number of professionals working in finance and law, whereas semi-rural suburbs such as Badgery’s Creek have more residents working in road freight transport and vegetable growing and have been less financially affected.
The split is mirrored in Victoria. Melbourne’s seaside suburb of St Kilda is dark red despite having a lower than average unemployment rate compared to the industrial south-western suburb of Laverton, where unemployment is 44.2 per cent higher than the rest of the state but is marked light yellow for a “medium” financial impact. The researchers say those already on low incomes pre-COVID-19 who have now lost their job would not have experienced a significant change in income after receiving JobKeeper or JobSeeker payments.
The data also shows Victorians overall are facing a greater financial impact compared to NSW, with 144 suburbs marked in the worst affected category, more than double NSW. Mr Greenfield warned this will worsen as the state is plunged into further lockdown restrictions. Some of Melbourne’s northwestern and eastern suburbs, for example, are rated in the “extreme impact’ category.
Ms Goward said it was clear NSW was in a better position after the government adopted a more rigorous approach to quarantine following the mishandling of returned cruise ship passengers. “Obviously the Ruby Princess really shocked the NSW government systems and it probably drove a greater focus and critical approach to everything they did,” Ms Goward said.
Accommodation and hospitality were the worst-hit industries, according to the research, and Mr Greenfield said Victoria, with its strong food culture, would continue to struggle as restaurants and bars are forced back to take-away only services for six weeks.
“Social distancing stops big cities from working. Cities are about gatherings and people, social distancing is about the opposite,” Mr Greenfield said, adding that even once lockdowns are lifted Victoria’s higher community transmission rate would continue to make people feel uncomfortable about leaving their homes.
Victoria’s regional communities are also doing it tough, particularly in the western part of the state, with densely-populated farming land and tourism-dependent towns starved of income. Regional NSW was helped by its mining industry and sparsely populated agricultural land, Mr Greenfield said.
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Charlotte is a reporter for The Age.