The number of JobKeeper recipients has fallen from 3.6 million to 1.5 million in less than two months, outperforming federal budget forecasts of 2.2 million recipients.
Around 86 per cent of workers are on the tier 1 payment of $1,200 per fortnight, with around 14 per cent on the tier 2 payment of $750 per fortnight.
The latest data from the ATO shows that around half a million entities are still accessing the wage subsidy, with about 450,000 businesses dropping off from the scheme after eligibility was tightened at the end of September.
Businesses had to prove that they had suffered the specified 15 per cent, 30 per cent or 50 per cent decline in turnover for the September quarter to qualify for the first JobKeeper extension, which runs until the start of the new year.
The second extension period, which runs from 4 January to 28 March 2021, will require entities to satisfy the decline in turnover test for the December 2020 quarter.
“The lower-than-forecast take-up of the JobKeeper payment extension in October is further evidence that Australia’s recovery from this once-in-a-century pandemic is well underway,” Mr Frydenberg said.
“Recent economic data shows that outside Victoria, employment has recovered to be less than 1 per cent below March levels, with some 650,000 jobs created in the past five months nationwide.
“The Reserve Bank of Australia has recently updated its forecast for the unemployment rate, which it now expects to peak at around 8 per cent, down from its earlier forecast of 10 per cent.”
JobKeeper payment rates will fall again in January to $1,000 per fortnight for those working 80 hours or more in a four-week period before the pandemic, and $650 per fortnight for everyone else.
Despite trending in the right direction, the Treasurer said “that the road ahead will be hard, it will be bumpy, it will be long”.
“There will be some businesses that don’t make it and some jobs that cannot be saved. But it’s our analysis the unemployment rate will come down next year and the year ahead even after JobKeeper comes off at the end of March,” he said.
The Treasurer also pointed out the current trade issues with China are hurting both countries’ recovery.
“This is a challenging time, with Australia’s largest trading partner in China. But it is a mutually beneficial relationship. China benefits greatly from Australia’s iron ore, which underpins its economic growth.
“So, we will obviously work through these issues.”